The Trust Accounting Service is an outsourced way to run the daily operation and financial solvency of an agency’s insurance trust accounts. Much like a payroll service, it works from the source documents your agency already produces — policy transactions, endorsements, payments, audits and company statements — and manages premium and return-premium fiduciary funds from the moment of a transaction until they are disbursed to their legal owners.
The questions and answers below cover the concept and the practice: what the service is, why it is built around premium financial solvency, and what it takes for an agency to adopt it.
Questions & answers
What Is the Trust Accounting Service?
An outsourced premium-management solution for independent P&C agents and brokers — fiduciary funds held in trust and managed from receipt to disbursement.
Q02Is the Service Similar to a Payroll Service?
Like payroll, it works from source documents your agency already produces — with the added complexity of managing premiums through to disbursement.
Q03How Does the Service Compare with a Direct-Bill Operation?
A direct-bill operation is itself a form of premium-management outsourcing; the Trust Accounting Service brings the same relief to agency-bill business.
Q04What Is the Service Objective?
Keeping premium and return-premium funds financially solvent at all times, as the Insurance Code requires of fiduciaries.
Q05Why Is the Service Focused on Solvency?
Premium float is tightly regulated: funds received under one policy cannot be remitted for another, and premiums can never offset agency expenses.
Q06Why Does the Service Manage Solvency Better than Current Systems?
A specialized fiduciary accounting system: more than 65 premium ledger accounts, separate ledgers and a balance sheet for each trust fund.
Q07Why Would an Agency Retain the Service?
Trust operations are a non-core cost center. Outsourcing them frees resources — an average agency may expect a 40% higher profit margin.
Q08Does the Service Improve Agency Financial Performance?
Automation cuts operating costs, boosts premium float and interest income, and removes earned-premium liabilities and uncollectible-account risk.
Q09Do Both Large and Small Agencies Benefit?
Agencies of every size gain — and the larger the agency, the higher its operational and financial benefits.
Q10Does the Service Compete with Agency Management Software?
No — it is a service, not software, and it delivers premium solvency reports that agency management products do not.
Q11Would the Service Render Current Management Systems Obsolete?
No — it complements AMS, Applied Systems and similar products, taking over only premium and return-premium management.
Q12How Difficult Is the Transition?
The service phases in with new business and renewals — no disruption — and is fully implemented once the book of business renews.
Q13What Does an Agency Need to Retain the Service?
An internet connection, a computer with a standard web browser, a designated staff contact, and brief training for service and accounting staff.
Q14How Is the Service Provided?
Online, from Paulmar’s remote office — with access limited to a shared source-document folder; all other agency data stays out of reach.
Q15Do Agency Personnel Require Training?
Yes — brief role-specific training for customer service representatives, accounting staff and agency managers.
Q16What Is the Service Scope of Work?
Premiums and endorsements, commission transfers, company remittances, return premiums, producer commissions, and on-demand reports.
Service presentation
From the Paulmar archive
The original slide presentation introducing the Insurance Trust Account Service™ to independent P&C agencies.