The Ultimate Guide to Understanding Insurance Premium Financing

premium financing

The insurance premium financing (IPF) industry has grown tremendously over the past several years. This segment has grown so much that it now makes up a sizeable portion of the insurance market. This is great news for both consumers and insurers, as it means that more people have access to affordable insurance coverage. However, with any new industry comes new terminology and concepts to learn. If you’re someone who likes things simple, you’ve come to the right place. In this article, we will cover everything you need to know about insurance premium financing.

What is insurance premium financing?

Insurance premium financing is a type of insurance financing that allows individuals to pay their insurance premiums in installments. This type of financing is available for both personal and commercial lines of insurance, such as auto, homeowners, and business liability insurance. IPF allows you to spread the cost of your insurance premiums over a period of time. This can be helpful for those who cannot pay their premiums in full at the time of purchase.

What are the benefits of Insurance Premium financing?

Insurance premium financing offers you a wide range of benefits including;

  • Lifts the burden of lump sum insurance premium payment
  • Enhances business cash flow management
  • Immediate access to annual insurance cover
  • Flexible repayment periods for the insurance premium

With insurance premium financing, business owners can attain the insurance coverage they need while keeping their assets intact.

Are There Any Downsides to Insurance premium financing?

IPF is a great way to help you save money on the cost of your insurance premiums. It allows you to pay them over time instead of having to pay them all at once. However, it’s important to make sure you are able to make your payments on time. If you are unable to do so, you might risk losing your insurance coverage altogether.

If you are unable to pay your premiums, most insurance providers will first try to reach out to you. If you don’t respond to their attempts of contact, they will eventually cancel your insurance coverage. If you’re having trouble making your payments, it’s a good idea to reach out to your insurance provider and ask for help.

How does insurance premium financing work?

Insurance Premium Finance is a short-term loan product that allows your business to spread the cost of large annual insurance premiums. We pay the cost of your insurance in one sum directly to your insurance provider and then your business repays the cost in monthly repayments over an agreed term. We provide this service over a 3-10 month period to our customers, while our financing solutions range between KES 20,000 as the minimum and KES 400,000 maximum amount.

The IPF loan involves a tripartite agreement between the customer, the insurance company (guarantor), and Mwananchi Credit Limited (financier).

Who offers insurance premium financing?

Although there are many insurance providers that offer this type of financing, it’s important to shop around. You don’t want to fall into the trap of just choosing the first financing provider you find. You want to make sure you’re choosing the best financing provider for you.

At Shimin Insurance Agency we offer insurance premium financing with the best rates from all our trusted partners.

What are the required documents when applying for Insurance premium financing?

We keep our requirements as minimal as possible. This is to ensure that the application process is as hassle-free as possible to get your financing quickly. As such, the minimum requirements for insurance premium financing are:

  • Completed application form alongside the premium financing agreement.
  • Copy of National PIN and ID of the applicant
  • Copy of Certification of Incorporation (For business owners, a Certificate of Registration is required)
  • Company PIN
  • ID/PIN for all directors
  • Company Certificate of Incorporation
  • Memorandum and Articles of Association
  • Latest CR12/Annual Returns in case of change of directors

Who Is Eligible For Insurance Premium Financing?

There are a wide variety of clients eligible for our insurance premium loans. This is because various parties can benefit from this financing. This includes the following:

  • Family-owned or small businesses
  • Major corporations
  • Non-profit organisations (NGOs)
  • Large-scale firms
  • People with specialized needs
  • Owners of property assets and valuable belongings
  • Investors
  • Consultants
  • People with families
  • Homeowners
  • Vehicle owners

As a result, all of these clients are eligible for insurance premium financing with us. Our customer representative team will get back to you within only 30 minutes during working hours. Additionally, we have branches all over Kenya in Kisumu, Eldoret, Thika, Nairobi, Kitengela, and Mombasa. This ensures that you can visit us wherever you may be with ease.

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