Reconciling Insurer Accounts
Purpose
Insurer
Accounts record transactional activity generated from Fixed Loan and
Variable Loan modules when insurance is financed. These transactions result in balances that
are normally paid out to insurer creditors, or in some cases is recovered from
them (insurance rebates on early termination).
At
the end of the month, if all Insurer
Payout Processes are run on time, each Insurer Account should have a zero
balance.
Timing
Insurer
balances are usually paid out at month end, but may be done earlier
Access
- Insurer | Access Insurer Accounts |
the Insurer account
|
Process
Offsetting
transactions should be grouped to
ensure all transactions have been correctly processed. If the offsetting transactions result in a
zero balance, then that “event” can be considered reconciled.
In
each case, the reconciliation process is to 
the related entries and 
. In
order for the entries to be grouped, they must total zero. An Insurer Account
is considered reconciled once all transactions are grouped and the current
ledger balance is zero.
At
month end an Insurer Account may have a balance. This could be due to a timing difference
between a loan being settled and the payment made to the creditor. This is acceptable as long as the reason for
the balance is known.
Some
finance companies finance their own insurance components (Payment Waiver and
GAP). These are considered income to the
finance company and need to be manually transferred to income prior to each
month end. That is achieved by adding a
debit transaction to the insurer account for the balance of that account and
then grouping all the insurance transactions against that payment. The Insurer Account will then have a 0.00
balance and be reconciled.
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