New and improved options for initial premium payments – you and your customers have the most flexibility about how and when to pay for Life policies. (These options are not yet available in NY — coming soon.)
In the Premium section of the application, your customers can choose a variety of new payment options.
Does your customer want…
… immediate coverage as soon as the policy is issued?
Choose “Draft Upon Issue”, then Draft Initial Premium On “Next Available”.
… to pay via EFT, but is carefully planning the timing of when the first payment will occur?
Choose “Delayed bank draft” under “Initial Premium Draft Options” so that your customer can be informed before the policy is drafted. The policy will issue when it’s ready but the payment will be treated as “collect on delivery”. The draft won’t take place until the agent emails email@example.com to proceed with the EFT payment.
… to pay via EFT and get coverage ASAP, but wishes for a specific day of the month for future payments?
Choose “Draft Upon Issue”, then Draft Initial Premium On “Next Available”, at the bottom of this section of the e-App, you can select whatever date the customer wishes for future months’ payments.
Tips and Tricks for Premium (Part F) on the Application for Life Insurance:
How does your customer plan to pay recurring premiums for this policy?
- Select Electronic Funds Transfer (EFT) if the customer wants fully automated payments.
- Select Paper Bill if the customer wishes to initiate their payment via the Customer Portal. (Initial premium payments via the Customer Portal coming in 2020!)
- Select Single Premium if it’s a one-time premium payment.
How does your customer wish to make the initial premium?
By choosing “yes” I authorize National Life Group to draft the initial premium for this contract, the customer gives us permission to perform an Electronic Funds Transfer (EFT) for the initial premium.
Draft upon issue – Choose “Next Available” if you want the case to issue ASAP.
- This option is best for customers who need immediate coverage and those who want conditional coverage as protection before the case issues.
- This is the fastest way to generate commissions!
- If Next Available is chosen: Once the policy is issued, payment will be deducted from the customer bank account the following day. If today is January 1st and the application was issued today, the initial premium would be drafted on January 2nd. Recurring drafts would be set for the 1st of every month thereafter.
- Please note: Be careful to educate your client that drafts could happen in close proximity if the case is issued at the end of the month. For example, if the case issues on the 27th with Next Available chosen and recurring drafts are set for the 2nd of the month, the initial premium would be drafted on January 28th and the next recurring premium would be drafted on February 2nd.
- If you choose a specific date, that will be the effective date of the policy. For example, if today is the January 1st and the customer has elected the 28th for their draft date, the policy effective date will be January 28th and all recurring drafts will occur on the 28th.
For customers who want to give permission before the initial payment, select: Delayed bank draft
- When your customer is ready to make their first payment, the agent can email firstname.lastname@example.org to initiate the EFT. (Agent initiating payment is only possible on this delayed bank draft option.)
- This option gives the customer the most control over the timing of their payment but does not provide any conditional coverage to the customer.
- After the payment is generated, the commission will show as a pending commission on the agent portal, typically one day after the draft (typically one day after the agent’s email, but could vary with holidays or other variables).
- Important: For customers choosing delayed bank draft, the policy is typically issued with an immediate effective date. In order to avoid multiple premium payments, it is important that authorization to draft the initial premium is granted as quickly as possible. If the policy has issued and we don’t have approval to draft by the end of the month, two premium payments may be required, depending on the product.