Glossary
Installment Plan
A carrier-offered schedule allowing an insured to pay premium in periodic instalments rather than in a single payment.
Instalment plans are the carrier's own financing, usually with a per-instalment service charge rather than interest. They are common in personal lines and smaller commercial accounts.
Because commission is often paid as instalments are collected rather than at inception, a policy on instalments generates a stream of small commission lines across the term. Each has to tie back to the same policy, and a missed instalment produces both a collection issue and a commission gap.
See also
- Premium Finance — A lending arrangement in which a third party pays a policy's premium up front and the insured repays it in instalments w…
- Down Payment — The initial payment an insured makes to put a policy in force, with the balance paid through instalments or premium fina…
- Commission Statement — A document from a carrier showing the commissions earned by an agency on policies sold, including premium amounts, commi…