Down Payment and Fully Earned Premium Financing

March 9, 2018

Premium Finance Associates (PFA) works with many different types of businesses from retail to commercial.  The businesses with larger premium have to provide larger Down Payments.  We have financial products for businesses that rely heavily on cash flow such as transportation and construction.  For accounts that have annual premium of $20,000 or greater with a down payment of $5,000.00 or higher, we offer “DOWN PAYMENT PREMIUM FINANCING.”  You mean a premium finance contract with “ZERO OUT OF POCKET?”  YES – that’s exactly what we are offering Premiere Agents with Premium Insureds.

PFA does a quick analysis of insureds by reviewing a brief application and most recent 4 month commercial bank statements for an unsecured loan in as soon as 1 business day.  We work with quite a few transportation companies that traditionally factor their receivables.  We offer competitive factor rates on unsecured loans that can be debited from an account on a weekly basis.  Our terms range from 4 months to 10 months as we try to coincide with their premium finance contract at 8, 9 or 10 month pay plan.  Interest charges and factor rates cost less with shorter terms but increases the longer the loan is out. 

In addition to Down Payment premium financing, Audits are typically due within 30 days of discovery.  Just imagine an unexpected audit of $75,000 or even $150,000 payable within 30 days!  Talk about a concerning issue that takes precedence over everything else, including management and planning for the upcoming year…  Our simple application along with most recent bank statements can produce a proposal that same day for review, underwriting and close. 

What about bond premium?  Typically, bond premium is fully earned - so in the unlikely event of cancellation for any reason, there would be no return premium.  This IS NOT a secured loan so we need to make sure it is underwritten accordingly.  When underwriting insurance premium, the unused portion is typically unearned, making the transaction secured since the carrier will return the unused premium Pro Rata.  When financing Bond Premium, the unused portion means nothing as return premium is moot.  Based on the cash flow of the company and creditworthiness of the business owner, PFA can underwrite and provide a 4-10 month term debited weekly from the insured’s commercial bank account.

If your agency is interested in a “decided advantage” when it comes to premium financing, then call or email Bill Friend, owner of Premium Finance Associates for a no cost agency approval and insured analysis.  Bill has owned Premium Finance Associates, LLC for 16 years and has 25 years of experience in the Premium Finance industry. See Bill’s contact information below:


**Brand New - Commission Advance programs for Insurance Agents and Businesses

Bill Friend, Principal 
7603 First Place Dr., B-12
Cleveland, Oh. 44146
866.FRIEND.0 (374.3630)
866.839.3090 fax
216.225.4321 cell

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