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... premiums for non-admitted or for excess and surplus lines carriers. He also steers...ses, earn more on their existing book, and get their money sooner.

...these solutions requires planning. Banks look at cash flow and a balance sheet...unnecessary meetings to put out fires, and helps you to determine the best tim...

...arge losses — by purchasing excess insurance or reinsurance. INSURANCE ... free monthly online magazine for risk and insurance professionals.

...he benefits of a growing excess and surplus lines market, while standard line carriers are pulling ...o licensing the software from a vendor and running the finance company ...

... In Personal Lines, most insureds, banks, and real estate agents need evidences of i...omply with all applicable laws, rules, and regulations.

... fees don't add to much to the monthly amount the customers will pay, O'Neil says, and besides: The selling point is service. The customer usually just says, Where do I sign? ' O'Neil has been operating Bay Budget for 11 years, drawing on bank debt and internal funds for capital. Today the subsidiary earns a return that O'Neil will only say is in six figures. And while he knows not everyone wants to do this much premium financing, his rationale is convincing: You can easily make $50, ... with all the troubles we've had in Florida [in hurricane-related insolvencies], we've lost less than $1 ,000, ' he says, and I expect to get half of that back. But to minimize such exposures, O'Neil won't finance premiums for non-admitted or for excess and surplus lines carriers. He also steers clear of audited premium policies, since the insured may be handed a bill for more premium to pay for past coverage. If that happens, the bill could land in O'Neil's lap. Strict procedures and attention to detail ... greatly minimize the E&O risk from arising from an incorrect billing or cancellation, says Imperial's Cycon. If you make a mistake like that, it can cause a lot of grief, ' he warns. Cycon also believes it's best not to spread your business among several finance companies. You might not want to put all you eggs in one basket, but if you bring more volume to one company, you can get better terms. Whatever level of risk agents accept in premium financing, there remains the question of whether it's ...

...luding CGL policies, umbrella and excess policies, and even workers compensation and homeowners policies. If the events in ... are enforceable under both California and U.S. law, unless they can be attack...

... of losses should be at least several dozen per year, of which most are less than $50,000. As a case in point, a large hotel would probably experience many small Workers Compensation claims but relatively few, if any, large claims. A bank can also expect to have numerous low severity Comp claims. Alternative risk financing usually involves loss severity — the exposure to large losses — by purchasing excess insurance or reinsurance. INSURANCE LINES The other question asked most often is "What lines of insurance are best for ... risk financing?" Casualty lines — Workers Compensation, General Liability (including Products), and Auto Liability — are the best candidates for alternative risk financing. Workers Comp and Liability claims tend to be paid over long time frames, one to five years or more. Insurers of these lines generate substantial investment income on their reserves until losses are fully paid. Mid-size companies using alternative risk financing can earn the investment income on reserves that was formerly earned by an insurance company. ALTERNATIVE RISK FINANCING OPTIONS Insurers have developed many colorful titles ... administrative paperwork. Deductible and self-insured plans will require a focus on cash management. Security requirements are generally met by providing bonds or letters of credit. In some cases, the proper form of security offsets the impact of a policyholder's losses or other liabilities on an insurer's surplus. Although owners and top management will be delighted with premium savings, they might be unaware that they need to be closely concerned with the process. The company's controller or human resources manager should involve the consultant or broker in educating management. CONCLUSION Medium-sized companies might ...

... also makes annual deductible contributions to the plan. Thus, the loan is paid back with pre-tax dollars. The following is a thumbnail description of an ESOP operation. First, the ESOP purchases the employer's stock from the shareholder. The ESOP borrows the money from a bank, pledging the stock as security. It then holds the stock for the benefit of participants, who have, in general, the same rights and privileges as any other stockholder. The stock is then distributed to the participants when they are eligible to receive it ... value, the purchase can be a violation of the trustee's fiduciary duties. If the employer corporation contributes stock to the ESOP and claims a deduction for the contribution greater than the fair market value of the stock, the deduction will be disallowed by the amount of the excess claimed. Worse yet, an excise tax can be imposed upon the principal shareholder or employer who sells stock to an ESOP at greater than fair market value. If a plan participant sells shares back to the ESOP or the employer corporation at a put option priced ... less than its fair market value, the participant may have a cause of action against the ESOP or the employer. An interesting case that illustrates these principles is Donovan v.Cunningham (716 F.2d 1455, CA-5; 1983) . In that case, the issue was whether the ESOP trustees had caused the ESOP to purchase employer stock from the employer corporation's sole shareholder for more than its fair market value. The trustees had obtained an appraisal of the value of the stock from an independent appraiser, which is a statutory requirement for ESOP purchases ...

...twenty-five percent (25%). 4.1.3 Excess Over Purchase Price. In the event suc...a Shareholder, in which case the price and terms shall be as set forth in Sections 3 and 4 above; disability of any Sharehol...