Book of Business Financing
Description:
1-10 year amortized loans specifically tailored for Insurance agencies. The insurance industry is usually restricted in most funding platforms due to the unique nature of premium ownership to assignable policies. Book of Business funding uses policy ownership as a tangible asset to borrow against. Loans range from 20K to 25M. Asset values generally are 10% of book value, example 3M book would yield 300K of tangible asset to lend against. Each deal is and will be treated as unique and tailored to the needs of the client. Typical use of funds are: Acquisitions, Working Capital, Expansion, and debt consolidation.
Submission:
- Completed application
- Personal Financial Statement
- Insurance annual reports (TPP, CSRP, or reports that have policy renewals, commission, and age)
- Once received and reviewed a consult call will be scheduled directly with loan processor
Once legible and completed documents are received the file is reviewed by a Finance officer and you will be contacted within 24 hours to discuss findings and all options available to client.
Additional Notes:
- As mentioned above, each deal is treated unique. Owner’s industry experience is heavily weighed.
- Must be a non-captive agent
- Policies must be owned by Agent or assignable
- Cannot still be in vested period
- Owner’s FICO: 620+
- No BKs
- Prefer: Allstate, Independent, and Nationwide agents
- Collateral Required: Book of Business
- Loan Amounts: Borrow 2-3 times annual renewal commissions
- Term: 3-10 year loan
- Rates: 4-9% + prime rate
- Credit Requirements: 620 FICO or higher
- Details: Only available for insurance agents
- Deal Submission Requirements: Application, summary of existing renewables