Special Section sponsored by TMPAA

COST Financial Group, Inc.

Specializes in managing and operating premium finance companies owned by insurance agencies, MGAs/wholesalers, and insurance companies

On the face of it, probably no industry veteran would fault insurance officials for hesitating to create an in-house premium finance company. After all, wouldn’t that endeavor mean learning how to manage such an enterprise, purchasing new materials and software, and hiring additional staff to handle increased bookwork?

Without question, it would. That’s why nearly 200 independent agencies, wholesalers/MGAs, and insurance companies retain the services of COST Financial Group to do this important work for them.

“We handle all of those chores for our clients,” says David E. Gebhardt, COST’s Chairman/CEO and the firm’s 1989 founder. “We take care of administrative, management and bookkeeping functions, then leave the agency to do what it does best—selling and servicing its insurance customers.”

To enhance its serviceability, COST recently released the latest generation of premium finance company software. This system supplies clients with a wealth of interactivity and information access. It’s easy to set up, easy to use, and easy to integrate into existing agency procedures.

A state of the art Web site provides synergy between COST’s systems and its clients in the field. “It offers complete access to all typical daily operations of our client’s finance company,” said Chris Gebhardt, the company’s COO. “The system is fully customizable and provides flexible solutions for all types and sizes of clients—from single agency locations to large, multiple-site clients. Quotes are generated quickly and easily and printed finance agreements can be submitted electronically for paperless workflow. The system’s flexibility provides different levels of user access, thus allowing managers and executives expanded privileges within the system.”

Included among the key features in COST’s management software are:

• Automatic account number notification on new business accounts

• Real-time status that allows users to follow activity as it happens

• Ease of training. A single 30-minute Web conference session has an agency up and running quickly.

• Various alternative payment methods

• Total Account History (TAH). This module gives users a chronological history of account activity as well as a PDF-based viewable history of all printed materials. Users can view copies of cancellation notices, reinstatement requests, and other important business data.

This COST system is an efficient, effective “turnkey approach” operation. “Basically, what we do comes down to this,” says David Gebhardt. “The premium finance company owners earn the profit; COST does all the work. And that includes supplying the monthly, quarterly, and annual reports that state licensing departments require.”

All correspondence and other forms of communication are handled by fully trained personnel in COST’s St. Louis, Missouri, area headquarters. Billing; issuing late/cancellation or reinstatement notices; remittance processing; and bookkeeping for clients’ finance companies—all are among the daily functions conducted at COST. And, for the protection of every client, COST carries errors and omissions and fidelity coverage, and maintains no check signing authority over clients’ bank accounts.

By owning their own premium finance company and contracting with COST for a modest service fee to manage it, clients generally generate between $30,000 and $40,000 per million dollars that they finance through their own premium finance company. In effect, it becomes a ready-made profit center for the agency. That benefit, among others, combined with the insurance industry’s soft market, has prompted several companies to renew interest in COST’s capabilities. “Many of them,” notes David Gebhardt, “have been potential clients for some time. Now, over the past year or so, we’re hearing from them again as they revisit premium financing.”

Many firms with which COST does business are Target Markets Program Administrators Association (TMPAA) members. COST, a long-time vendor member, finds that networking within TMPAA leads to mutually beneficial business relationships with other members.

For details on how COST can assist with instituting and maintaining your in-house premium finance operation—and to learn more about COST’s online quoting and software system—COST Financial Group, Inc., invites your inquiries at (800) 844-2678 or www.costfinancial.com. *