Regulatory and Process Changes Series – Non-Payment of Premiums

New regulations (15A of the PPR’s) have made the following up on non-payment of premiums a more formal and inflexible process that we all need to be aware of to ensure cover remains in place with the least amount of time and effort expended.

Premiums are due at the end of the month for which cover is being paid. We are now working towards a 15th of the month deadline, which means that premiums for cover in the month of April, for example, have a deadline of the 15th of May.

Any premium not received by the 15th will be deemed to be outstanding. We have until the end of that month to resolve the issue before the formal credit control process begins.

The formal credit control process involves three sets of communication – the first being from ourselves to the advisor on record, the second after a further 2 weeks to the advisor and employer, and the third after another 2 weeks to the advisor, the employer and the members.

Should premiums remain unpaid, cover will cease at the end of July, after all parties have received at least 30 days’ notice that this would be the outcome should premiums not be paid.

The timeline in our example for a premium due for cover in April would look like this:

  • 15 May:           Deadline for premium payment
  • 1 June:            First formal credit control communication to advisor
  • 15 June:          Second communication to advisor and employer
  • 30 June:          Third communication to advisor, employer and members
  • 31 July:           Cover ceases and scheme cancelled

As mentioned above, it is only the minority of cases in which we must chase for outstanding premiums, and the new regulatory requirements still provide us with a reasonable amount of time to engage with premium payers and resolve issues, even in these difficult times.

We will always contact advisors first when these cases arise and keep you informed before any action is taken. We understand the delicacy of these situations and will ensure that every attempt is made to avoid having to inconvenience clients whilst also ensuring that we all meet the regulatory requirements.

If you have any questions in this regard, please do not hesitate to contact us.

Thank you and regards,

The TSA Team

Vol 9 Issue 6

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