One of the challenges of being a business insurance broker is that your clients have to budget for ongoing premiums to keep their policies active. Every time a premium needs to be paid or a policy needs to be renewed, there is a risk that you could lose a client’s business.
If only there were a simple way for your clients to fund their business insurance premiums that you could use to both safeguard and increase your commission income. Well, there is! — It’s called Invoice Finance, and it creates a win/win situation for both you and your clients.
Read on to find out everything you need to know about how invoice financing can open up a world of opportunities for your clients and your own business.
Navigating a tough business insurance market
Business conditions have been harsh for the past couple of years, and many analysts are tipping even more challenging times ahead. Rising interest rates in Australia and around the world are putting pressure on business cash flow. The rising inflation rate in Australia is also reducing consumers’ disposable incomes to spend on business goods and services which is impacting sales, when businesses are already having difficulty getting the materials and products they need, thanks to major supply chain disruptions.
To top off a perfect business insurance storm, premiums are rising due to increased natural disaster claims, and the terms and conditions of policy coverage are generally becoming more restrictive.
All of these factors put ongoing business insurance premium payments and policy renewals at risk. The true value of your clients’ policies may not be appreciated by them unless they have made a claim during a previous coverage period.
Cash-strapped businesses may be tempted to let their insurance coverage lapse or reduce their coverage. Both scenarios leave them dangerously exposed, and these decisions can also negatively impact your revenue as a business insurance broker.
Invoice Finance as a business cash flow (and insurance premium funding) solution
Invoice Finance is a line of credit that helps businesses to turn their unpaid client invoices into cash. Instead of waiting for their clients to pay their invoices, they can access their future cash flow to use today. It’s ideal for ensuring the cash flow of any business that offers their customers credit terms — rather than wait days, weeks or even months for their customers to pay, they can accelerate their cash cycle to use the funds for growth opportunities (or to pay their insurance premiums!).
One of the great features of Invoice Finance is that the line of credit grows as the value of customer invoices grows. So the business has access to growing capital if they need to access it.
Your benefits for recommending Invoice Financing to your business insurance clients
Your clients won’t be the only ones to benefit if you recommend invoice financing to them. You can benefit as an insurance broker as well. Invoice financing can help you to:
- Increase your client retention rate by ensuring they will have the cash flow to pay their business insurance premiums.
- Reduce the time you spend chasing late or unpaid premiums.
- Create an additional revenue stream for you as an insurance broker. You can earn generous rates of commission (upfront and trail) on any Invoice Finance facilities taken out by your clients. This means you can earn passive income while your clients access the cash flow solution they need.
If you'd like to learn how Earlypay's Invoice Finance & Equipment Finance can help you boost your working capital to fund growth or keep on top of day-to-day operations of your business, contact Earlypay's helpful team today on 1300 760 205, visit our sign-up form or contact [email protected].