Birch Financial, Inc.
HEREINAFTER REFERRED TO AS THE PREMIUM FINANCE CO. AND/OR THE PFC
ADMINISTRATIVE OFFICE: 0000 X. Xxxxxxx Xxx. - Xxxxx 000 - Xxxxxxx, XX 00000
(000)000-0000
MAILING ADDRESS: X.X. Xxx 00000 - Xx. Xxxxx, XX 00000-0000
PREMIUM FINANCE AGREEMENT
BORROWER AGENT
Name SUB AGENT
Address Address
City City
Zip Code Phone Zip Code Phone
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Itemization of Amount Financed: The AMOUNT FINANCED (Box C below) consists
entirely of the amount of credit that will be paid on your behalf for the
policies listed in the Schedule of Policies.
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A. TOTAL B. DOWN C. AMOUNT D. FINANCE E. TOTAL OF
PREMIUM PAYMENT FINANCED CHARGE PAYMENTS
(A+B) (C+D)
The amount The dollar The amount you
Of credit amount the will have paid
provided to credit will after you have
to you or cost you. made all payments
on your behalf. as scheduled.
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ANNUAL The first payment is PAYMENT SCHEDULE Number of
PERCENTAGE due not more than First Payment Amount Payments
RATE one month from orig- Payment Due Date of Each Payable
The cost of ination date. Due. Payment Monthly
your credit as
a yearly rate.
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THIS AREA FOR Security Interest: You are giving a security interest in all
PFC USE ONLY unearned premiums, dividends, loss payments under the policies
577 listed in the schedule of policies, and in any interest
arising under a state guarantee fund relating to these items.
Prepayment: When a payment is delinquent ten days or more
after the payment due date shown above you will pay a late
charge of up to 5% of the delinquent payment.
Contract Reference: See the agreement for more information
about nonpayment, default, any required repayment in full
before the scheduled date, prepayment refunds and security
interest.
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SCHEDULE OF POLICIES
POLICY NUMBER TERM NAME OF INSURANCE CO. TYPE OF INCEPTION PREMIUM
MOS. AND ADDRESS OF ISSUING COVERAGE DATE
OFFICE OR OF POLICY
ISSUING GENERAL AGENT
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The insurance agent/broker has included and will be paid from the finance
charge a producers fee for preparation and submission of this premium finance
agreement of $ __________
Notice: Each policy listed above may be canceled if you do not make all
payments in accordance with this agreement. All conditions appearing on the
face or back of this agreement are a part of this agreement.
NOTICE TO BORROWER: 1. DO NOT SIGN THIS AGREEMENT BEFORE YOU READ IT OR IF IT
CONTAINS ANY BLANK SPACE. 2. YOU ARE ENTITLED TO A COMPLETELY FILLED-IN COPY
OF THIS AGREEMENT. 3. UNDER LAW YOU HAVE THE RIGHT TO PAY OFF IN ADVANCE THE
FULL AMOUNT DUE AND UNDER CERTAIN CONDITIONS TO OBTAIN A PARTIAL REFUND OF THE
FINANCE CHARGE.
POWER OF ATTORNEY: Borrower irrevocably appoints the PFC as its Attorney-in-
Fact with complete authority to cancel the policies, to demand, collect, xxx
for, receive and give receipt for all sums assigned above to the PVC, and to
execute and deliver on Borrower's behalf all document, forms, and notices
relating to the policies in furtherance of this Agreement. Any money received
as Attorney-in-Fact shall be subtracted from any amount owed to the PFC by
Borrower, and if there is a surplus, it shall be paid to Borrower if it is
greater than $1.00.
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Signature of Borrower Date
AGENT OR BROKER WARRANTY
The undersigned warrants that Borrower's signature is genuine. When the
Borrower has not signed this Agreement, the undersigned warrants that he/she
has been authorized to sign this Agreement on the Borrower's behalf. The
undersigned warrants that Borrower has received a copy of this Agreement and
has been fully informed of its terms and conditions.
Additionally, the undersigned warrants that: 1. The policies are in full
force and effect and the premiums are correct, 2. He/she will hold in trust
for the PFC any payments made or credited to the insured directly or
indirectly through the agent by the insurance companies, and will pay those
moneys to the PFC upon demand to satisfy the outstanding indebtedness of the
Borrower, 3. any lien the agent may have or may acquire on any return premium
arising out of the financed policies is subordinated to the PFC's lien or
security interest therein, 4. the policies comply with the PFC's eligibility
requirements, 5. the loan proceeds are not being used to finance a business
that is seasonal in nature and subject to audit or a minimum premium, 6. no
audit, retrospective rated policies, or reporting form policies are included
except as specifically indicated, and the deposit or provisional premiums for
such policies are not less than the premiums that would be earned for the full
term of the policies, 7. no policy is subject to a minimum earned premium
except as specifically stated, 8. the Borrower is not now in or being placed
in, or is not instituting a proceeding in bankruptcy, receivership, or
insolvency, and 9. the down payment has been collected by the agent from the
Borrower.
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Signature of Agent/Sub Agent Date
PROVISIONS OF YOUR PREMIUM FINANCE AGREEMENT
1. PROMISE TO PAY: In consideration of the premium payments to be made by the
PFC to the above named insurance companies or the above named Agent or Sub
Agent. Borrower (jointly and severalty, if more than one Borrower) promises
to pay the PFC at the address above or such other address as PFC shall specify
in writing, the Total of Payments stated in Box "E" according to the Payment
Schedule agreed to and the provisions on both the front and back of this
Agreement. If any payment made by check is returned due to insufficient
funds, or is for any other reason non-negotiable, there will be a charge of
$15.00.
2. SECURITY INTEREST: Borrower gives the PFC a security interest in, and
assigns to the PFC as security for any amount due under this Agreement,
including interest, late or cancellation charges, any and all unearned
premiums and dividends which may be payable under the insurance policies
listed in the Schedule of Policies, loss payments which reduce the unearned
premiums, and any interest arising under a state guarantee fund relating to
these items.
3. FINANCE CHARGE: The Finance Charge shown in Box "D" begins to accrue on
the earliest policy inception date listed on the front side of this agreement.
4. DEFAULT AND CANCELLATION: Borrower agrees that the PFC may cancel any
policy and the unpaid balance owed will be immediately due and payable to the
PFC if any one or more of the following defaults in the terms and conditions
of the agreement occur:
(a) Borrower defaults in the payment of any installment payment due;
(b) A voluntary or involuntary proceeding in bankruptcy, receivership or
insolvency is instituted by or against te Borrower;
(c) Borrower is a business and stops doing business or ceases to be
qualified to do business; or
(d) If any of the insurers become insolvent, suspend business, or cease to
be qualified to do business.
In the event of a policy cancellation, the insurance company is authorized and
instructed to issue checks solely to the PFC.
The liability of the PFC to any person or corporation, upon exercise of its
right to cancel, is limited to the amount of the unpaid principle balance.
Any payments received by the PFC after cancellation shall be credited to
Borrower's account without waiver by the PFC of any default. If a deficiency
remains, Borrower agrees to pay the amount of such deficiency to the PFC. A
deficiency of $5.00 or less will be waived by the PFC. The PFC may, at its
option, collect and enforce the payment of any amount owed by Borrower without
recourse to the security assigned to the PFC.
Borrower agrees to pay to the PFC reasonable attorney fees and collection
costs to the extent and amount permitted by law.
5. PREPAYMENT: Borrower will receive a refund credit of part of the finance
charge if the borrower voluntarily prepays the outstanding debt in full before
the last installment due date according to Section 18629 of the Financial
Code. The borrower will also receive a refund credit of part of the finance
charge if the maturity of the loan is accelerated for any reason according to
Section 18642 of the Financial Code. The methods for computing these refund
credits are stated below.
(a) Voluntary Prepayment - (i) if prepayment in full is made during the
first three months and 15 days after the earliest insurance policy
effective date as shown on the front of the contract, the PFC will compute
a finance charge by multiplying the agreed rate of charge as stated at the
end of this Agreement by the unpaid principal balances for the number of
days from the earliest policy effective date to the date of prepayment in
full. PFC will apply each payment by the borrower first to finance charge
and then to principal. The PFC will then determine the refund credit due
the borrower by first deducting from the finance charge shown in Box D of
the contract any fees paid the insurance agent/producer as indicated on
the face of this agreement. From this balance, that is net of the fees,
the PFC will deduct interest computed at the agreed rate of charge and any
balance remaining, if the balance is more than $1.00, shall be the refund
credit due the borrower. (ii) if prepayment in full is made more than
three months and 16 days after the earliest policy effective date, the
refund credit shall be computed by applying the Rule of 78's method
against the total finance charge after deducting from the finance charge
indicated in Box D only fees paid to the insurance agent/broker.
(b) Acceleration of Maturity - If payment of the unpaid balance of the
loan to the PFC is accelerated for any reason, the PFC shall make the same
refund or credit as would be required if this loan contract was paid in
full on the date of acceleration. Paragraph (a) above states the method
of computing the refund or credit. The unpaid balance remaining after
subtracting the refund or credit shall be treated as the unpaid principal
balance. The insured agrees to pay to the PFC on the unpaid principal
balance interest computed at the agreed rate of charge stated in this
Agreement until the PFC is actually paid in full.
6. PAYMENTS AFTER CANCELLATION: If the PFC receives any payments from
Borrower after cancellation procedures have been initiated or effected, the
PFC may attempt to stop cancellation or to reinstate the cancellation policy,
but the PFC is under no obligation to make such attempts, and does not
guarantee that if such attempts are made, they will be successful. All
payments made after cancellation will be applied by the PFC to the Borrower's
outstanding indebtedness. Borrower agrees that the PFC is not responsible for
and cannot control insurance coverage. The PFC will not be responsible for
any claims which arise under such policy after the effective date of
cancellation.
7. BORROWER'S REPRESENTATIONS: Borrower represents that the policies or
binders listed above have been issued and are in full force and effect.
Borrower also represents that, except for the interest of mortgages and loss
payees, no interest in the policies, including a security interest in unearned
premiums, dividends, loss payments, and any interest under a state guarantee
fund, has been or will be granted or assigned.
8. AUDIT OR REPORTING FORM POLICY: If a policy is auditable or is a reporting
form policy or subject to retrospective rating, Borrower agrees to pay the
insurer the earned premium, computed as specified in the policy, which exceeds
the premium already advanced by the PFC to the insurer.
9. ACCURACY: If any policy listed in the above schedule has not been issued
when Borrower signs this Agreement, Borrower authorizes the PFC, or the agent
or broker, to insert the insurer's name, the policy numbers, and the due date
of the first payment after Borrower's signing. The PFC is also authorized to
correct any obvious errors in this Agreement. The PFC will give Borrower
written notice of additions or corrections made.
10. AGENCY: The agent or broker named above is Borrower's agent or broker and
not an agent of the PFC. The PFC is not legally bound by any representation,
oral or written, made by the agent or broker to Borrower. The PFC is not an
agent of any insurer and will not be responsible for any act, error, or
omission of an insurer.
11. ASSIGNMENT: All of the PFC's rights under this Agreement shall inure to
successors and assigns.
12. EFFECTIVE DATE: This Agreement is effective when the PFC accepts it and
mails its written acceptance to Borrower.
13. WAIVER: The PFC's failure to require strict performance of any provision
or to exercise any of its rights under this Agreement shall not be construed a
waiver, or relinquishment of any future right under such provision, but the
provision shall continue and remain in full force and effect.
14. ENTIRE DOCUMENT AND GOVERNING LAW: This document is the entire agreement
between the PFC and Borrower and can only be changed by writing signed by both
parties. The laws of the state of California will govern this Agreement. If
any provision of this Agreement is held to be invalid or unenforceable, the
validity and unenforceable of the remaining provisions shall not be impaired.
15. BORROWER RELEASES, DISCHARGES AND AGREES TO HOLD HARMLESS THE PFC AND ITS
AGENTS, OFFICERS, EMPLOYEES OR ASSIGNEES FROM LIABILITY OR CAUSE OF ACTION DUE
TO ANY CANCELLATION OF NOTIFICATION OF CANCELLATION MADE PURSUANT TO THE
PROVISIONS OF THIS AGREEMENT.
16. AGREED RATE OF CHARGE: The rate of charge for a loan not to exceed
$2,499.99 computed from the effective date of the insurance coverage shall not
exceed: 2% per month on the part of the unpaid principal balance not exceeding
$1,000; 1% per month on any remainder of such unpaid balance in excess of
$1,000. If the unpaid principal balance is $2,500.00 or more the agreed rate
of charge shall be the greater of 1.5% per month or interest computed at the
annual percentage rate at which this Agreement was accepted. Application of
this charge may result in an effective ANNUAL PERCENTAGE RATE that is higher
than that stated in this agreement and there is no limit on the amount of the
difference. All loans shall be subject to minimum finance charge of $25.00.
If the Borrower is dissatisfied with the terms of this note or the terms
differ upon disclosure, the Borrower may within 10 days after disclosure is
matted to Borrower rescind the note by paying the amount in Box C and will not
be required to pay any finance charge.
FOR INFORMATION CONTACT THE DEPARTMENT OF FINANCIAL INSTITUTIONS, STATE OF
CALIFORNIA.
