Paying insurance premiums through Electronic Funds Transfer is becoming a more popular payment option in recent years. EFT allows you to pay insurance premiums electronically through your savings or checking account. Payment using EFT offers several advantages over paying insurance premiums by writing a check. Once people have started using the EFT payment method they wonder why they have not utilized it sooner.
EFT simply authorizes your bank, credit union or other institution to pay your insurance premium from your account on a monthly, quarterly or other basis, depending upon the payment options offered by your carrier. The advantages offered through EFT are listed below.
- Convenience– You will no longer need to write checks to pay your insurance premiums. Unlike payroll deduction, EFT is not tied to your employer and is seamless upon changing employment.
- Installment Fees Waived – In nearly all cases, premium installment fees are dropped with EFT. Generally, installment fees average $5.00 a month when writing checks. This alone is $60.00 annually in savings.
- Premium discount – Many companies offer premium discounts when selecting this payment method. The savings is generally up to 5% of your annual premium.
- Time Savings– The electronic funds transfer is automatic for each installment. Once the authorization is setup, there is no further time commitment on your part.
- Selection – The EFT option is offered by almost every insurance carrier. You still have a wide selection of carriers and can have EFT through two or more carriers simultaneously. This option allows you to take advantage of the best premium rate offered through multiple carriers and to save on installment fees through all carriers.
- Local Service– Payment using EFT does affect your local office service. All questions and changes on your account are still handled by your local service agent.