How premium financing can fuel business growth

Published on Oct 09, 2023

How premium financing can fuel business growth

Whether you’re a small startup or an established enterprise, finding ways to fuel growth and expand your operations is essential for long-term success. One often overlooked growth strategy is premium financing. This innovative financial tool can provide the necessary capital to fund insurance premiums, enabling businesses like yours to allocate their resources more effectively and focus on expansion. Here is how insurance premium financing can be a game-changer for accelerating growth.

Preserve Cash Flow

First and foremost, premium financing allows businesses to preserve their cash flow. Insurance premiums can be substantial, especially for businesses in high-risk industries or with extensive coverage needs. By financing these premiums, companies can spread the cost over a set period – typically in monthly installments. This allows businesses to preserve their working capital and allocate funds to other critical areas, such as research and development, marketing, or hiring new talent.

Adapt & Expand

Premium financing also offers flexibility and scalability. As a business grows, so do its insurance needs. Whether it’s increasing coverage limits, adding new policies, or entering new markets, the insurance requirements can become more complex and expensive. Premium financing allows businesses to adapt their insurance coverage as they expand, providing the financial flexibility required to meet changing needs. With premium financing, businesses can access the necessary capital to secure higher coverage limits or add new policies without a significant upfront cost.

Improve Credit

Additionally, premium financing can improve a company’s credit profile. When businesses finance their insurance premiums, they establish a credit relationship with the financing company. By making regular, on-time payments, businesses demonstrate their creditworthiness and build a positive credit history. This can be particularly helpful for small businesses or startups. An improved credit profile can open doors to other future financing opportunities, such as loans or lines of credit.

Manage Risk

Finally, premium financing can help businesses manage risk. By financing their insurance premiums, companies can free up capital to invest in risk management strategies and technologies. For example, a manufacturing company can allocate funds toward implementing advanced safety measures or acquiring state-of-the-art equipment. By proactively managing risks, businesses can reduce the likelihood and severity of insurance claims, potentially leading to lower premiums in the future.

Interested in Premium Financing to Help Your Business Grow?

Agile Premium Finance, a division of Valley Bank, is a leader in the insurance premium finance industry. Our innovative approach to finance provides you with a short-term loan by utilizing commercial insurance policies as collateral. This allows clients to improve their cash flow, preserve capital, and retain funds for capital projects and investments. We offer state-of-the-art processes and a web-based premium finance system that includes:

•  Flexible terms with no personal guarantee required

•  Simple application process

•  Most commercial insurance policies are eligible

•  24/7 account access

•  Easy annual renewal


This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for tax, legal or accounting advice. © 2023 Valley National Bank, All Rights Reserved.

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