WHAT IS PREMIUM FINANCING?
Premium Financing is the convenient way to pay for insurance.
When you finance your insurance premium, you enter into a contract with NPG Finance Limited for a loan to pay your insurance premium based on a suitable payment plan. You make a deposit (this is usually a minimum of 25% of the total premium) and repay NPG Finance Limited in instalments for the loan plus the interest in accordance with the agreed payment plan.
HOW DOES PREMIUM FINANCING WORK?
We have set out three examples of possible payment plans to illustrate how premium financing can work for you. The Total Annual Premium (or cost of the insurance for the year) used in all three examples is $78,400.00 and is inclusive of GCT, stamp duty and service charges.
EXAMPLE 1 (Flat Charge)
Total Annual Premium 78,400.00
Deposit (more than the required 25%) 30,000.00
Loan Amount 48,400.00
Interest Charge (flat charge) 6,000.00
Amount to be repaid 54,400.00
Monthly Instalment $6,800.00 for eight (8) months
A flat interest charge of $6,000.00 is applicable in this example as the loan amount is below $50,000.00 (refer to the RATES SCHEDULE for more information). If the deposit amount is more than the required 25% of the Total Annual Premium, the amount of the monthly instalment will be reduced.
EXAMPLE 2 (Add-on Rate)
Total Annual Premium 78,400.00
Deposit (25% of premium) 19,600.00
Loan Amount 58,800.00
Interest Charge (13% add-on rate) 7,644.00
Amount to be repaid 66,444.00
Monthly Instalment $8,305.00 for eight (8) months
In this example the deposit amount is 25% of the Total Annual Premium. The Add-on Rate is applicable as the amount of the loan is over $50,000.00 (refer to the RATES SCHEDULE for more information).
EXAMPLE 3 (100% Financing)
Total Annual Premium 78,400.00
Interest Charge (13% add-on rate) 10,192.00
Amount to be repaid 88,592.00
Monthly Instalment $11,074.00 for eight (8) months
In this example the deposit is waived, therefore the full cost of the insurance is financed. The Add-on Rate is applicable on the loan amount of $78,400.00. THE FIRST INSTALMENT OF $11,074.00 IS DUE AND PAYABLE IMMEDIATELY.
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