The profile of the high street is changing rapidly, particularly as a result of COVID-19. The initial impact has caused the closing of retail outlets, no longer able to compete in a pandemic era against a backdrop of limited customer access and the increased popularity of online shopping.

The second, more positive stage of this scenario has been the redevelopment of empty shops converting them into new or split use developments such as mixed hospitality, retail and residential units. So what insurance opportunities are created in this situation?

This change of use has implications for landlords, tenants and business owners with new and extended types of insurance required to provide cover for the newly introduced type of business, which could in many cases include increased premiums.

Business customers will potentially require wider payment options to help finance the wider cover needed and combat the financial strain created by any rise in premium costs. Insurance premium finance is a strong solution for insurers and brokers to offer.

Having a credit facility to spread the cost of insurance premiums in convenient monthly instalments can make all the difference to a customer, freeing up liquidity to spend in other key areas – taking away the need to pay in one large, upfront payment. Insurance costs, accommodating any change of cover, become a more accessible opportunity, even in tough economic times allowing the right cover to be secured when it’s needed.

Premium finance also brings a wide set of additional benefits not only to the customer, but to the broker and insurer too. As well as increasing payment options and customer choice, intermediaries and insurers partnering with a specialist premium finance provider can receive a percentage commission for every new credit agreement they set up for their customers choosing to pay in this way. Insurers also receive their premium upfront in a timely manner, rather than having to collect from the customer through the policy year or account for delays in payments.

The credit lending regulatory risk, when offering finance, is also transferred to the insurance premium finance provider often freeing up internal compliance resource for the broker or insurer and changing their regulatory status to a credit broker.

In short, premium finance can provide a win, win scenario for the insurer, broker and customer.