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... x No Thanks Loading.. Work Flow Procedures Manual-Commercial Audit Procedure 4/30/2013 by CompleteMarkets Editor This content has not been rated yet. COMMERCIAL INSURANCE AUDIT PROCEDURE In most agencies, audits are processed much like all other types of mail. Because of the adverse financial impact that an audit can have upon an agency, it is our opinion that a specialized processing take place. Unlike other company billings that are normally controlled by the CSR/Marketer, it is our feeling that the audits be under the direct supervision of the bookkeeper or financial manager. 1. All audits when, received by the Financial Manager/Bookkeeper are logged in on Form audit.frm 2. Financial Manager/Bookkeeper establishes a follow up date 5 days prior to the date that an audit can be returned to the company for direct collection. 3. Financial Manager/Bookkeeper notes on the agency copy of the audit the follow up date and forwards the audit to the CSR/Marketer for processing. 4. CSR/Marketer reviews the Audit confirming that the correct rates and exposure units have been used. 5. If audit is incorrect, immediately return to the company to be reissued and notify the Financial Manager/Bookkeeper. 6. If audit is correct, CSR/Marketer invoices the audit and mails to customer with Cover Letter. Dear : Enclosed you find the final audit on your ___ policy, number ___, which expired ____ . I believe that the audit is correct after having verified the rates and mathematical extensions. However, if you find any errors in the exposure information, please ...

... individual (using an in-house system, a batcher, or a request from each company) . Sub-producer codes for each licensed individual can be established through your insurance carriers or through your own automated accounting system. In most states, you can only legally pay commissions to a licensed broker, solicitor, or agent. In other cases, those without a license may choose to leave the insurance business, or may not be dedicated to responsibly caring for clients' needs. For these reasons, only licensed individuals should receive sub-producer codes. To assign sub-producer codes through your carriers, you must discuss with your marketing representative or branch manager the possibility of their providing you with separate producer statements. Keep in mind that, by using your companies' abilities for sorting production, you also may incur additional in-house bookkeeping duties. For example, you may wish to verify multiple, individual statements from your carriers each month. You also need to be aware that company-issued sub-producer codes will be printed on your clients' policy declarations. You could unintentionally wind up with a partner' keep this situation in mind. By assigning sub-producer codes on your internal automated system, you and your bookkeeper maintain control of production statements and policy coding. Recording this production can be accomplished in one of two ways. First, assign an internal two-, three-, or four-digit code to each individual. When a policy is written through the particular individual's efforts, the application is still coded to your agency's company producer code. The sub-producer should then complete a manual record or system entry of the production. Your bookkeeper can make ...

... using an in-house system, a batcher, or a request from each company) . Sub-producer codes for each licensed individual can be established through your insurance carriers or through your own automated accounting system. In most states, you can only legally pay commissions to a licensed broker, solicitor, or agent. In other cases, those without a license may choose to leave the insurance business, or may not be dedicated to responsibly caring for clients' needs. For these reasons, only licensed individuals should receive sub-producer codes. To assign sub-producer codes through your carriers, you must discuss with your marketing representative or branch manager the possibility of him or her providing you with separate producer statements. Keep in mind that, by using your companies' abilities for sorting production, you also may incur additional in-house bookkeeping duties. For example, you may wish to verify multiple, individual statements from your carriers each month. You also need to be aware that company-issued sub-producer codes will be printed on your clients' policy declarations. You could unintentionally wind up with a partner' keep this situation in mind. By assigning sub-producer codes on your internal automated system, you and your bookkeeper maintain control of production statements and policy coding. Recording this production can be accomplished in one of two ways: First, assign an internal two-, three-, or four-digit code to each individual. When a policy is written through the particular individual's efforts, the application is still coded to your agency's company producer code. The sub-producer should then complete a manual record or system entry of the production. Your bookkeeper can make ...

... by CompleteMarkets Editor , Angela Bemiss This content has not been rated yet. In today's insurance environment, a successful insurance agent or broker must have good sales management, good operations management, and good financial management. If the management of sales and operations is inadequate, revenues obviously won't grow, productivity will be lower than it should be, and/or the environment will be chaotic. If an agency's financial management is inadequate, however, years may pass before the problems becomes evident-and it may be too late to fix them. Let's look back at the evolution of today's agency financial management. As you do this, think about your own agency and the role of your financial manager. Evolution of the Financial Manager In the not-so-distant past, an insurance agency's finances may have been managed by a bookkeeper sitting in a dark back office sweating over an account current ledger (wearing green eyeshades, of course) . Life was stressful for that bookkeeper because all the columns on his ledger had to balance, and much of his work had to be done manually. Before the advent of spreadsheets, financial projections or forecasts could be done, but this was slow and tedious. When agency automation was introduced, it came with the automatic computation and printing of account currents and many other financial reports. The average agency had increased in size, and the financial manager might now be an accountant. Life was still stressful because he was most frequently responsible for the new computer system. He knew very little about computer software and hardware, but he was the logical choice for this responsibility, since anyone ...

... can easily take control of a CSR's time. When this happens, service suffers. True risk management - providing total financial protection for clients - requires time and careful attention to details. This sort of quality care leads to excellent retention rates. You've heard it before: It costs far less to keep an existing account than it costs to get a new one. So, implementing a careful renewal transaction plan is of paramount importance. Planning your work then working your plan helps you accomplish more in a day. A solid renewal control process will help you control your work rather than it controlling you! Here are some recommended steps for implementing a comprehensive renewal flow plan: RENEWALS 1) Get the renewal control list. This list should be prepared from the information contained in invoices. The agency's bookkeeper or accounting personnel can prepare this report three to four months in advance of the renewal month. The list should be produced by date and in alphabetical order. If you work in a team, the list can be generated by producer code and in chronological order. 2) Update. Review the list and make direct notations on it with information about modified expiration dates, coverage types, and so on. 3) Review with producers. The list now becomes a skeleton agenda' for a meeting of the minds. The CSR (along with other CSRs involved with the account), the producer(s ) of record, the sales manager (if you have one), and the bookkeeper should meet to design a strategy for determining who will contact each client and estimating how much ...

... sheets, sales letters, and more! Communications Marketing Customer Service Planning Finance/Accounting Risk Management Human Resources Selling Legal and E&O Technology Life/Financial Services Glossaries Management Resources & Links Categories Popular Recent All Back Collections 4/30/2013 10:38:09 PM by CompleteMarkets Editor This content has not been rated yet. COLLECTIONS The purpose of a collection system is to collect money owed to the agency without alienating the insured. In this section, we will answer the following questions: Who should do the collecting? What are the steps to developing an effective collection system? When should you collect? Why must every agency set a goal concerning collections? OVERVIEW Who Should Do the collecting? One staff person should be responsible for the collection system. This person should be the bookkeeper, financial manager, or another individual in the accounting department. Do not involve the producer in collecting unpaid premiums. A producer cannot be the good guy' who develops a friendly relationship with the insured and then the bad guy' at collection time. What Are the Steps to Developing an Effective Collection System? 1. Appoint a responsible collection manager. 2. Establish a list of key accounts (the agency's largest and best accounts), which are not subject to automatic collection rules. These accounts receive special attention by telephone from the collection manager. 3. Establish an agreement with CSRs and anyone who processes new and renewal policies that a policy inception date cannot go by without a binder and a billing. 4. Proceed to get payment within 15 days of the renewal date, ...

... so notes on the customer's electronic file and deletes all follow ups. CANCELLATION PROCEDURE AGENCY REQUEST 1. The CSR/Marketer calls the company and requests that they send a direct notice of cancellation 2. CSR/Marketer confirms in writing that policy is to be cancelled by direct notice of the company. 3. CSR/Marketer sets up a suspense of 6 days for receipt of cancellation notice. 4. If notice is not received, follow up with company and resuspense for an additional 6 days. 5. When cancellation is received, review for correctness and note the effective date of cancellation on customer's electronic file. 6. If agency has requested cancellation for non payment of an agency billed premium, set a suspense date of 1 day prior to the effective date of cancellation to check with bookkeeping to determine if premium has been paid. 7. If the payment has been made, CSR/Marketer should notify company in writing and on the phone to reinstate the policy or coverage. 8. If policy is not to be reinstated, CSR/Marketer notes the cancelled status of the account in the customer's electronic file. 9. If the cancelled policy requires an audit, CSR/Marketer sets up a 45 day suspense to await the final audit figures. 10. Once cancellation is final and (if necessary) the audit is received, CSR/Marketer bills the customer for any additional premium or sends unearned premium to customer. 11. CSR/Marketer then removes all suspense items, notes transactions on the customer's note pad and files all paperwork in the transactional file. CANCELLATION ...

... more people in your client's organization have connections with the people in your agency. In other words, involve the agency team in the handling of the account. Here are some ways to establish vertical client relationships: If you need your client's signature, have your CSR call your contact's assistant and offer to bring the paperwork by to meet with the client or assistant. Invite your client's insurance-handling team to lunch or for an after-work activity to get to know your team members. Everyone on the agency team should make personal contact when appropriate. For example, they might introduce themselves to a new account with a phone call or note with business card enclosed, or they might send a congratulatory card acknowledging a personal or business achievement. Have your claim staff meet their counterparts in your client's office. The bookkeepers can meet the client to answer questions about agency-billed or direct-billed invoices. Producers should be acquainted with not only the key decision maker but also all of the other users of the insurance product, such as the people who meet with insurance company audit and loss control staff, the bookkeeper, president, CFO, and their assistants. These contacts can keep your account-handling team informed and alert to any changes in the risk, threats to the account, and new business opportunities. Be a Solution Provider. Agents who are solution providers can help their clients to identify and solve risk management challenges, answer a variety of questions, and refer or access resource information to help their clients in their businesses. Solution providers don't say I don't know, ' It's not my job, ' or That's not ...

... /Marketer so notes on the customer's electronic file and deletes all follow ups. AGENCY REQUEST 1. The CSR/Marketer calls the company and requests that they send a direct notice of cancellation 2. CSR/Marketer confirms in writing that policy is to be cancelled by direct notice of the company. 3. CSR/Marketer sets up a suspense of 6 days for receipt of cancellation notice. 4. If notice is not received, follow up with company and resuspense for an additional 6 days. 5. When cancellation is received, review for correctness and note the effective date of cancellation on customer's electronic file. 6. If agency has requested cancellation for non payment of an agency billed premium, set a suspense date of 1 day prior to the effective date of cancellation to check with bookkeeping to determine if premium has been paid. 7. If the payment has been made, CSR/Marketer should notify company in writing and on the phone to reinstate the policy or coverage. 8. If policy is not to be reinstated, CSR/Marketer notes the cancelled status of the account in the customer's electronic file. 9. If the cancelled policy requires an audit, CSR/Marketer sets up a 45 day suspense to await the final audit figures. 10. Once cancellation is final and (if necessary) the audit is received, CSR/Marketer bills the customer for any additional premium or sends unearned premium to customer. 11. CSR/Marketer then removes all suspense items, notes transactions on the customer's note pad and files all paperwork in the transactional file. CUSTOMER ...

... your agency grow more investment income. Put Small Commercial accounts on direct bill to eliminate the costs of personnel to handle invoicing and collection of small accounts. Implement a stringent collection policy, with no deviations such as advancing premiums on behalf of clients. Make capital expenditures by investing in better people (both technical and salespersons), computers, office equipment, and target marketing. This will allow you to build future value, rather than reaping short-term gains through bonuses or taking out as much profit as possible (as many owners have in the past) . Failure to reinvest in your agency will leave a hollow shell by rapidly decreasing the firm's value. The agency owner's role in most medium to large-size firms should be strategic, rather than focused on day-to-day tasks. The employee handling the accounting/bookkeeping will perform all necessary functions, including preparing reports for management. The accounting manager's job description should include a checklist of the tasks that they're expected to perform (see below for sample) . Base all management decisions on how they will impact the value of the firm. This type of focus will help you choose the direction that will ultimately lead to more money for retirement from either an internal sale of stock, a merger, and/or the eventual sale of the firm to a third party. PERIODIC FINANCIAL REVIEW CHECKLIST FOR ACCOUNTING MANAGER Every agency should develop a checklist for the accounting manager/bookkeeper to follow. Good communication between accounting and the owner is crucial to effective financial management. All checklists should include these items: Monthly Run balance sheet Review cash position Review receivables and payables ...