March 22nd, 2021
Over the last year, COVID-19 has forced lenders to drastically reconsider the way they operate, especially from a loan servicing and risk management perspective. Insurance tracking was already challenging before the pandemic, and when lender, agency and insurance company staffs began to work remotely in 2020, communication breakdowns and delays made timely process of verification very difficult.
To ease the insurance tracking burden and minimize risk, there has been an increased demand in blanket insurance programs. Blanket policies eliminate the time and effort of tracking insurance while also protecting lenders against uninsured risk within loan portfolios. One major area of concern has been centered around Commercial & Industrial (C&I) equipment portfolios as they typically are tied to businesses that may struggle financially due to COVID market conditions. Lenders have historically ignored tracking these loans in-house, essentially self-insuring the portfolio with no adequate mechanism to force place coverage if needed. As the risk has evolved in the past 12 months, so too has the need to insure it.
Commercial Lenders Single Interest (CLSI) is built on the same concept that popularized other blanket insurance products: simplicity. Much like with our traditional LSI/VSI product, there is no insurance tracking requirement once coverage has been verified at loan origination. If the equipment loan defaults and the repossessed collateral has uninsured physical damage or theft, the Lender is indemnified for the loss. Eligible collaterals include Vehicles, Agriculture, Construction, Medical/Dental, Retail, Restaurant, Entertainment and Manufacturing equipment and inventory. Limits, and deductibles are highly customizable and premiums can be paid on a monthly or annual basis.
To learn more about our CLSI product, or other blanket programs like Blanket Lenders Single Interest for auto loans and Blanket Mortgage Hazard or Blanket Mortgage Impairment for real estate lending, connect with our team for further details.