Every year, businesses across Australia write a single large cheque for their insurance premiums. It’s one of those costs that often arrives all at once and quietly puts pressure on cash flow. Insurance Premium Finance offers a practical alternative – and most business owners have never heard of it.
What is Insurance Premium Finance?
Insurance Premium Finance (IPF) is a fixed rate loan used specifically to fund the cost of business insurance premiums. Rather than paying your total annual premium upfront, IPF allows you to spread that cost across monthly instalments – typically over 10-12 months, though terms from 6 to 18 months are available depending on your premium duration.
The loan is made to your business, it’s a fixed rate and therefore repayments are fixed – so you know exactly what you’re paying each month with no surprises.
How does it work in practice?
A business with $80,000 in annual insurance premiums can spread that cost into predictable monthly payments rather than absorbing the full amount in one hit – freeing up working capital for operations, growth, or investment.
IPF is available across most types of business insurance, including general business and commercial packages, motor fleet policies, public and products liability, professional indemnity, and even motor vehicle registration fees and CTP.
The minimum loan amount is $5,000, and in most cases no additional security is required beyond the insurance policy itself – so you’re not tying up property or other business assets to access the facility.
The key distinction worth understanding is between cancellable and non-cancellable policies.
- Cancellable policies (like general business insurance) are treated as secured lending
- Non-cancellable policies (like workers compensation or professional indemnity) are unsecured, which means slightly different assessment criteria apply
Key features:
| Feature | Detail |
| Flexible terms | 6 to 18 months, with a typical loan running 10-12 months |
| Fixed rate | Competitive fixed interest rate and fixed monthly repayments |
| No extra security | Finance available in most cases without tying up other assets |
| Tax benefit potential | Interest on the facility may be deductible – speak to your adviser |
| Minimum loan | $5,000 – no maximum |
Who is it suitable for?
IPF is relevant for almost any trading business that carries insurance – which is virtually every business.
It’s particularly useful for businesses with significant annual insurance spend, businesses in industries with higher premium requirements (such as construction, professional services, transport, hospitality), and any business actively managing working capital.
It’s also a conversation worth having through your Accountant or Financial Planner. If your Adviser is looking at your business cash flow and annual outgoings, IPF may be an easy win that simply hadn’t come up before.
Is there a catch?
Not really. Like any loan facility, there is an interest cost – But for many businesses the cash flow benefit, combined with the potential tax deductibility of the interest, makes the cost well worth it. The rate is fixed and transparent, and the application process is straightforward.
The main things to check are the type of insurance you’re financing (cancellable vs non-cancellable), whether your business meets the standard eligibility criteria (ABN held for 2+ years, GST registered), and whether the loan amount triggers any additional documentation requirements – which our team can walk you through quickly.
How First Point Group can help
We arrange Insurance Premium Finance for clients regularly as part of our broader business finance offering. Whether you’re looking to smooth out a large annual premium, free up working capital, or simply explore whether IPF makes sense for your business, we can assess your situation and get a facility structured quickly.
We work with businesses across all industries nationally, and our team understands how to navigate the assessment requirements to get finance settled efficiently.
Ready to explore Insurance Premium Finance for your business?
Talk to the First Point Group team – we’ll assess your situation and walk you through your options.
There are many different types of finance we can help with
View our Services on our website or Contact Us to discuss your needs
