This product is targeted to our customers who have been with us for at least 6 months. It’s also targeted to customers who have credit facilities with us.
Exemption will be granted to non account holders who have been introduced through Kenya Orient only, since we will still hold the loan proceeds payable to them under lien.
TERMS AND CONDITIONS
Minimum amount: Kshs.25,000.00.
No maximum amount.
Repayment period: 4 months minimum and a maximum of 10 months
Interest rate to be charged: 6% flat
Minimum interest amount of Kshs.3,000.00 or 6% whichever is higher.
Processing fee: Nil
Ledger fee: Nil
Please note that under this product we shall not have an application and an offer letter but rather we will be signing an agreement with the customer
REQUIREMENTS.
a) An insurance Premium Finance Agreement form only.
b) PD Cheques or a standing order instruction.
c) A guarantee from the Insurance Company which is already embeded in the agreement form.
INSURANCE PREMIUM FINANCE- IPF
What is IPF?
How does it work?
The purpose of the inquiry would be to establish:
Are there any Limitations in applying for an IPF facility? Yes!
Is IPF applicable for all types of insurance? No!
· IPF is applicable with insurance’s that are normally placed or renewed for a fixed period of one year
Examples of such insurance policies:
· Fire and perils
· Motor Commercial or Private
· Industrial All Risk
· Workmen’s compensation
· Burglary
· Golfers policy
· Medical Insurance
· Contractors all risk policy
Examples of insurance policies where IPF is not workable:
What are the benefits in IPF to the Customer?
You have accepted to use IPF. What next?
· Customer completes the IPF agreement form
· The officer dealing with the customer computes the repayment amount.
· Customer then issues one current cheque and pays the balance in PD cheques or in form of a standing order.
· Alternatively he pays his first installment in cash and executes a standing instruction.
· The forms are then forwarded to the insurance company for execution of guarantee as the first cheque clears.
· Once the forms are returned to us we book the loan and issue the cheque to the insurance company.
· We then diarize and bank the PD cheques as and when they fall due…The transaction is complete.
What is the security in these IPF facilities?
Refundable premium = Financed premium x (365days – number of days from date of inception to date of demand)/365days
How long does it take to pay the Insurance Company(s)?
What happens if the Customer defaults?
NOTES
Efficiency in collection and completeness of documentation are the key factors to succeed in this
· The loans are booked on a flat rate basis. The rates reduce as the amount of loan increase.
· Give the customer seven days notice of cancellation of the insurance policies financed.
· After seven days write to the Insurance Company requesting for the cancellation of policies financed and requesting our refundable premium.
· After you receive your pro-rata refund- credit the customer’s loan account and close the file.
· Return the un banked PD cheques to the customer.
· On completion of documentation it takes:
· 24 hours if the first installment is paid in cash.
· At most five working days if the first installment is done by cheque.
· Guarantees from the relevant insurance companies undertaking to refund the refundable premium on demand in case of default by the customer.
· The refundable premium is calculated on the following basis:
· Alternative source of borrowing
· Cash flow management
· Purchase all your insurance needs
· Convenient and simple documentation
· Easy application process
· No credit appraisal
· Quick processing time
· No hidden charges or fees
· Competitive pricing
· Life insurance policies
· Marine policies
· Medical insurance placed with Health Care Providers e.g. AAR, Mediplus etc.
· The total premium to be financed must be at least Kshs. 25,000.
· The insurance policies being financed must be placed with Insurance Companies acceptable to us (see attached list of insurance companies with which arrangements are in place).
· Whether we would be ready to finance your insurance premium.
· What is the interest rate for such a facility?
· What is the repayment period? i.e. How many installments given to repay the loan?
· The procedure of applying for this IPF facility.
· It is very simple: When your insurance(s) falls due for renewal you come to us or call us directly or through your insurance broker or insurance agent
· This is a facility that enables you to pay your insurance premium in installments rather than
Mdosi Junior