Insurance Brokers eligible for Government ‘Bounce Back Loans’
The new UK-wide Government Bounce Back Loan scheme can (HM Treasury confirms) help small & medium-sized brokers to borrow between £2,000 and £50,000 through a network of accredited lenders.
Government guarantees 100% of the loan. There’s no fees and no interest or repayments to be made in the first 12 months. Brokers can apply online using a short, simple form. Loan terms will be up to 6 years & Government will work with lenders to agree a low rate of interest for the post 1st year period.
Note: You can apply for a loan if your business:
- is based in the UK
- has been negatively affected by Coronavirus
- was not an ‘undertaking in difficulty’ on 31st December 2019
The web section ‘Who cannot apply’ states: The following businesses are NOT eligible to apply: Banks, insurers and reinsurers (but not insurance brokers).
Treasury has clarified to @BIBA that the scheme Is available to insurance brokers. Remember you must also meet other criteria e.g. you cannot apply if you’re claiming under the Coronavirus Business Interruption Loan Scheme (CBILS). More details due on 4.5.20 scheme launch date, meanwhile read the Government information here https://www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan (cut and paste this URL into your browser)
Since the Coronavirus crisis began BIBA has repeatedly been in contact with HM Treasury to put forward the case that insurance brokers ought to be treated the same as any other small or medium sized business coping with the effects of lockdown (and not in the same way as large insurers or banks).
It is welcome that these continual, constructive conversations can help lead to a better appreciation of our sector and help understanding when it comes to decisions like brokers being eligible for Government’s small business grants and business rates relief. It is particularly pleasing that HMT now recognises that insurance brokers can range in size and many are wholly different to insurers in size and structure. To have insurance brokers specifically mentioned in a Government message is an indication of their understanding of brokers and acknowledgement of the role they fulfil. It will be of enormous value to some, that brokers are included in the businesses able to apply for the Bounce Back Loans.
Authored by BIBA
The British Insurance Brokers' Association (BIBA) is the UK 's leading general insurance organisation representing the interests of insurance brokers, intermediaries and their customers. BIBA membership includes 1,700 regulated firms. BIBA brokers handle around half the value of all UK home, contents, motor, travel, commercial and industrial insurance policies. Insurance brokers make a direct and indirect contribution of 1% to UK GDP.
BIBA is the voice of the industry advising members, the regulators, consumer bodies and other stakeholders on key insurance issues. BIBA provides unique schemes and facilities, technical advice, guidance on regulation and business support and is helping to raise, and maintain, industry standards.
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