If you’re a small or mid-sized lender, you might believe that you simply don’t have the loan volume to make payment protection –such as credit insurance or debt protection—worth your while. But what if you could unlock meaningful income with even modest loan volumes? We’ve seen time and time again where financial institutions of all sizes and loan volumes can create meaningful impact for their borrowers and tap into strategies that drive significant growth for their businesses.

You don’t need massive loan volumes to see the value

Let’s break this down with real numbers. Suppose your institution has $600M in eligible loans for debt protection in a year. If we look at a loan amount of $15,000 at 6%, within the first 12 months your financial institution would earn $134 of fee income. Over the course of 12 months with a 20% participation, meaning one in five loans add coverage to their loan, that is over $1M in earned income for your financial institution. 

Now let’s say your eligible loan volume is half and the other assumptions are the same, the fee income that is generated can make a real impact on your business.

Offering payment protection has additional benefits beyond income as well, including:

• Reducing loan defaults which protects your portfolio performance
• Building borrower trust and retention
• Setting yourself apart from other lenders to attract new borrowers

High eligible loan volume is not the only factor to see the rewards of payment protection. You simply need to lean into best practices and your provider to help you grow.

5 strategies to scale and optimize your program for growth

Hold quarterly strategy and training sessions with your provider

Quarterly sessions ensure your reviewing program performance data, identifying trends and adjusting as needed to achieve your goals. This consistent touchpoint is a great time to review metrics, discuss product features and provide any necessary training.

Establish goals and track metrics

Each year it’s important to work with your provider to help establish clear, achievable goals so that you can track performance throughout the year. Your provider can help you regularly track these goals and offer ideas and strategies to help increase payment protection adoption. 

Have a one-team mindset

Growing your program is a collaborative effort. Aligning departments like management, marketing, branch operations and lenders can make a huge difference in the success of your program. Ensure these teams are all aligned on established goals, key communications and materials needed to share payment protection with borrowers.

Provide consistent training and communication

Beyond quarterly training, it’s good practice to keep payment protection top of mind throughout the year. Consider offering short refreshers on topics like handling objections and the benefits of payment protection to equip teams with the knowledge and confidence needed to sell payment protection.

Consider an incentive program

Recognition and rewards can help your program. Consider designing a fair and motivating incentive program to help motivate your lenders.

Grow strategically with Securian Financial

Even with modest loan volumes, payment protection can have a significant impact on your business. At Securian Financial, we work closely with financial institutions across the country to establish strategies that can propel your program to its highest performance. We can help you understand the current state of your business, identify opportunities and help you implement them into your day-to-day business.

Contact us today, and let’s grow your program to its full potential.