We have all had them. Chronic late payers. Clients who violate your payment terms can wreak havoc with your agency’s cash flow.
Add to that the reality of COVID-19. It is anything but business as usual. This makes it more important than ever to rev up your payment collection and make sure you get paid timely.
You may know businesses that protect themselves against accounts receivable losses with A/R insurance/trade credit insurance. You may even be one of the specialty brokers that sell it. We hope you will never need such coverage.
Yet you should not need to shield yourself from late- and non-paying policyholders. The key is to speed up the payment process and minimize the chance of non-payment. We have put together 7 tips to help you do just that.
#1. Go digital
We have said it before, and we’ll say it again: consumers (including businesses) have long since embraced digital payment. They live in a 24/7 digital world and they expect to pay instantaneously for purchases. The keyword here is “instantaneously.” It is 2020. It is time.
#2 Offer payment options
The trends in payment choice are clear. Debit cards, credit cards, and ACH (direct payment) are on the rise. The move away from checks (and cash) was already accelerating before “touchless” payments became a public safety essential. Choice means clients are not tied to any one payment method. They can earn points on their Visa card this month or use their AmEx or a debit card next month.
#3 Make it easy to pay
Do not stress about having to layer an e-commerce platform onto your website. You do not need one to make online payments a breeze for your policyholders. First, be upfront about it. Do not make people have to search for your payment page. They will get frustrated. A link from your invoice template and a “pay now” button on your website will do the trick. Once clients know you offer card/ACH payment, they will quickly convert into delighted digital payers.
#4 Deliver help on demand
Sometimes even tech-savvy clients have questions or need help making their payment. They expect instant support (because they are used to it from the other vendors). Be prepared to answer their questions, whether it is through chat, in an email, or over the phone, and have resources in hand that can help them solve problems on their own.
#5 Enable automatic payments
Many policies require multiple payments, either monthly, quarterly, or semiannually. This creates multiple opportunities for clients to put off making payments. And you can never predict which client or which payment will be late! Offering recurring payments is a “set it and forget it” convenience for them. Equally important, it makes your receivables timely and predictable.
#6 Automate the dunning process
Imagine freeing your staff from sending out hundreds of invoice reminders and late payment notices each month. It’s a necessary task but consumes a lot of staff time. Switching to automated emails makes sure these notices go out on schedule. At ePayPolicy, our invoice reminders feature makes it even easier by creating automated emails for your team.
#7 Integrate with your AMS
If you are already using a management system, you know the power of automating business functions across your agency. While there are several industry agnostic payment processors out there (e.g., PayPal, Square, etc.) you’ll be better served with one that is designed specifically for independent insurance agents/brokers and that integrates with your management system.
The bottom line
I know it is a cliche, but time really is money. Your time is valuable, and so is your client’s. When it comes to paying insurance premiums, you both have a “need for speed.” If your goal is to turbocharge your receivables, you need to minimize slow-pay opportunities. The best way to do that is with client-pleasing digital payments.
ePayPolicy, OIA’s payment processor of choice, is here to help speed up your receivables. Sign up today with referral code oiamember and get TWO months free!