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Financial Policy for the Insurance Brokerage Company

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Table of Contents

  • FINACIAL POLICY FOR THE INSURANCE BROKERAGE COMPANY
  • Insurance Certificate Management
  • Petty cash Management
  • Bank Reconciliation procedure
  • Insurer Reconciliation procedures

FINACIAL POLICY FOR THE INSURANCE BROKERAGE COMPANY

Debt Management Refers to an unofficial agreement with unsecured creditors for repayment of debts over a specific time period.

  1. Insurance broker should have a system that generate the supportive document, in this case we should have system called insurance brokers services (IBS).
  2. This service help to generate debit note/risk note which consist all client information and also the name of reinsurer.
  3. Once the supportive document is generated it should be stamped with (PPW) meaning premium payment warranty which can be a period of 30 days,60days,90days according to the agreement or the policy of risk which will improve delay of premium payment.
  4. All debit note should be printed and posted.
  5. The company should have a policy on when the declaration of premium payment is to be done and the cheque to be delivered on time ,i.e every Tuesday of the second month.
  6. Filling should be done Once the payment is done and the copy of risk note/debt note has to be attached together with the payment voucher and a copy of the cheque.

Insurance Certificate Management

This is a summary document that is usually issued by an agent on behave of reinsurer . The company policy should ensure that, before a certificate is sued ,the following policy has been followed For Moto vehicle.

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  1. The certificate should have a policy number which will help in tracking.
  2. Certificate number is also applicable.
  3. Payment should be done before issue of certificate to avoid issued certificate on credit.
  4. 4 5. We should ensure all type of cover i.e private car, comprehensive, third party we have on stock.

  5. Before a certificate is delivered, it should be signed by designated person and a copy for filling should be made.
  6. All certificate should be locked in a cabinet and only designated persons is supposed to issue the certificate.
  7. Every 20th of month before declaration, reconciliation should be done to ensure no outstanding premium .
  8. All payment should be done through bank or other means of collection given by company.

Petty cash Management

This is the money kept by an organization for expenditure on small items The petty cash float it determined by CEO Reimbursement of Float

  1. Once the float reaches the half of what you have given, you should request another reimburse.
  2. The balancing float must be forwarded to the account.
  3. All the petty cash requisition form with the relevant attached supporting receipt , should be send to CEO both in hardcopy and softcopy for the approval.
  4. Once the director approves, the payment voucher should to be raised.
  5. Once you receive the receipt of cash the custodian person must balance off the petty cash and all expenditure must be posted to the relevant account.
  6. petty cash acount must be performed and signed by designated person once the cash is received.

Bank Reconciliation procedure

This a document that matches the cash balance on a company's balance sheet to the corresponding amount on its bank statement.

  1. Bank reconciliation should be done on monthly basis.
  2. Choose account to be reconciled , ensure all the journal is posted in a daily basis for both vendor and supplier.
  3. period for reconciliation should be set by director.
  4. Ensure the cash book/book cash is up to date before reconciliation.
  5. all payment that is reflecting to the bank statement should also reflect on cashbook.
  6. Payment made by client must be posted.
  7. Any undeposited cheque should be registered to cheque book register Through this you will be able to know the payment made but was not reflecting on our bank account.
  8. All payment made should be recoded in cash book and posted to accounting software which company uses I;e QuickBooks.
  9. Every month the bank statement should be issued to accounts department to ensure the reconciliation is done appropriately.

Insurer Reconciliation procedures

This is the process of ensuring that two sets of records (usually the balances of two accounts) are matching.

  1. The insurer inward and outward statement should be printed out.
  2. All payments should be posted and reflecting to both insurance software and accounting software.
  3. All payment done should reflect on statement.
  4. Any disagreement on reinsurer accounts, you should visit the reinsurer and complete the exercise.
  5. Every month, the statement should be sent to insurer for acknowledgement.

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