One of the nation’s largest premium funding companies is offering to pay five years worth of Ebix fees for 150 brokers who sign on to their new digital disruption product – and already less than half of those places remain.
Premium Funding went live with its new technology offering, PBTM (Pay By The Month) last week. The product claims to take the legwork out of premium funding by fully automating the contract preparation process, and aims to remove a huge amount of manual work for brokers, enabling them to earn more on commissions.
“It’s very important from a broker’s perspective, because it’s all about time saving and efficiency,” Premium Funding Director Ross Hayward told Broker Buzz.
“Say you have 5000 funding quotes per year. If it takes five minutes the old way to prepare a funding contract, that’s 25,000 minutes of work (52 days). Now that’s all gone.”
Premium Funding has committed to paying the entire Ebix fees for five years to the first 150 brokerages that sign on to use the product – estimated to cost them $7m. Hayward said the response has been terrific, with well over half of the places being snapped up within days – including some 50 brokerages who had rarely dealt with Premium Funding before.
“Most brokers are asking ‘what’s the catch?’ and there really is not a catch,” Hayward added. “It’s our way of ensuring we can get this out to the market quickly as possible and letting people know we are a very good alternative to their current funding provider.”
The new software has been developed over the last 18 months through an exclusive partnership with Ebix, whose WinBEAT solution is used by over 500 brokers in Australia.
The technology automatically calculates a monthly payment amount for all insurance policies created in WinBEAT and inserts it as a payment option onto every client’s invoice or statement.
Despite brokers’ warm reception to PBTM, Hayward did admit that he was concerned about where the premium funding industry was heading, given the gravitation towards digital products and automation.
“I’m certainly concerned that the easier our product is to get out there, the less our margin will be over time,” he said. “But we couldn’t just sit back and wait for it to happen. We had to be the first to do it. We had to make inroads and pick up market share by being the disrupter.
“But what disruption means for our industry in the long haul – I think it’s going to have huge consequences. And I think it’s going to make it more difficult for all us funders in the future.”