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BACS
Banks Automated Clearing Services
BACS is the central banking
system used by brokers to make direct debits from their policyholders’ bank
accounts. Advances in the last 5 years have made it much easier to adopt as
your main premium collection method.
Already using BACS?
December 2005 sees the mandatory upgrade to BACSTEL-IP, a faster, more
automated and high security method of collecting premiums.
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The nuts and bolts |
Basic details are collected
on your central administration system: Name, bank account details and amount to
be debited. Each month these are exported to a data file, such as a comma
separated variable file. The file is then sent by email to the Central Clearing
system which instructs a deduction from the policyholder’s bank account. You
are notified of bounced payments in a returned file and you may be able to
input this file directly into your computer system to be reprocessed. More
details on the BACS website.
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How can I make best use of BACS? |
Currently, many brokers are
using BACS for monthly direct debits where the policyholder pays the premium in
12 payments. Others use BACS to deduct the annual fee in advance. Automated Direct Debit Amendment and Cancellation
service (ADDACS) enables you to receive amendments and cancellations
electronically via a BACS mailbox, potentially eliminating the risk of errors
caused by manual keying.
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An example – PatientChoice |
PatientChoice,
a new business who have always used BACS, say that it is fundamental to the way
in which they run their business. Dr Thom van Every, Chief Medical Officer of PatientChoice,
said, “BACS helps us to streamline our business. A system with a built in BACS
facility, was essential. We send our file off to the BACS at the end of each
month and can be confident that the premiums are going to land in our account
within a few days.”
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Building Business |
BACS payment collection
points to a future whereby there is no paper in your office. Imagine that! The
savings on rent, staff costs and postage can be substantial. As policyholders
become increasingly internet-savvy, they will expect to have information
delivered to them online. Of course, a decision will have to be made about how
to retain your paper-loving policyholders.
At Plus One Services Ltd,
where electronic sales via Agents has become the norm, Veronica Ninnes, Finance
Officer reports, “BACSTEL-IP has proved invaluable to us – It’s quicker, user
friendly and far easier to conform to the business requirements.”. More
information from BACSTEL-IP.
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Good news for policyholders |
The most important benefit
for the policyholder is that you can offer them monthly payments at little
extra administrative cost to yourself. Furthermore the policyholder never has
to reach for their cheque book. They can simply check outgoing payments on
their bank statement.
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SCHEMATIC processes BACS |
SCHEMATIC is a quotation
and policy administration system for brokers, targeted at brokers who deal in
commercial and specialist personal lines. SCHEMATIC provides integrated BACS
facilities as well as tailored screens to reflect the business you do.
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For
more information about this article, ring Lucy Jaffé Sales Director on 020
7257 6309 or email Lucy.Jaffe@whitespace.co.uk |
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