What is typically required of policyholders under a premium finance plan?

In a premium finance plan, policyholders are typically required to make regular installment payments based on a finance agreement. This type of arrangement allows policyholders to pay for insurance premiums in smaller, manageable amounts rather than a single lump sum upfront. Consequently, this can make it easier for individuals to maintain their insurance coverage, as they are not burdened by the need to come up with the entire premium amount at once.

Unlike a full upfront payment, which would require the entire premium to be paid at the start of the policy, a premium finance plan spreads this cost over several payments, thus improving accessibility for many policyholders. The annual renewal fee and minimum coverage amount are not standard requirements of a premium finance plan; they pertain more to policy conditions and are not directly related to the installment payment structure that defines premium financing.