How do Cheep Insurance’s payment plans work?

How do Cheep Insurance’s payment plans work?

Most of the monthly payment plans that Cheep Insurance offers are financed through / managed by a company called IFS.

What is IFS?

IFS Financial Services Inc. is a Canadian premium financing company that manages monthly payment plans for thousands of insurance  policies across the country.

If your policy is financed through IFS, that means they manage your payment plan and any payment-related questions should be directed to them. If you miss a payment and need to make payment arrangements, the amazing team at IFS will be able to help you out!

How the payment plans work

Most Cheep Insurance policies are on one of three different payment plans:

1. Standard Monthly Payment Plan
2. Non-Standard Monthly Payment Plan
3. Facility Monthly Payment Plan

Standard Monthly Payment Plan

The Standard Monthly Payment Plan with IFS is the most common. A standard financing fee is applied to your total policy premium (the financing fee will be outlined on your financing contract), which is then divided over 11 payments. The first payment is paid directly to Cheep Insurance when the policy is set up, and the regular monthly payments are withdrawn directy from your bank account by IFS starting the following month. The 12th payment of the year goes towards your policy renewal.

Example:

Policy effective January 1
Total amount financed = policy premium of $1200 + standard financing fee (outlined on your financing contract) = $1247.40
Payments = $1247.40 divided over 11 equal payments = $113.40 monthly

January 1 – $113.40 (down payment paid directly to Cheep Insurance)
February 1 – $113.40
March 1 – $113.40
April 1 – $113.40
May 1 – $113.40
June 1 – $113.40
July 1 – $113.40
August 1 – $113.40
September 1 – $113.40
October 1 – $113.40
November 1 – $113.40
***December 1 – $113.40 (goes towards the policy renewal – if you cancel the renewal, this payment will be refunded)

If you have 2 or more missed / NSF payments in a policy period, IFS will renew your policy on the Non-Standard Monthly Payment Plan. A higher financing fee is applied to the total policy premium, which is then divided over 10 equal payments. There are then 2 additional payments withdrawn during that policy period, which are applied to the renewal. Even if the insurance price is the same, monthly payments on the non-standard plan are higher because the total amount is spread over less payments, and the last two payments of the policy term are kept as a reserve to apply towards your renewal to help get your payments back on track.

Non-Standard Monthly Payment Plan

The Non-Standard Monthly Payment Plan is often used for non-standard or high risk policies and has a higher financing fee that the Standard Monthly Payment Plan (the financing fee will be outlined on your financing contract). When a policy is set up on this payment plan, a 25% downpayment is collected by Cheep Insurance, and the remaining premium is spread over 9 equal payments, which are withdrawn directy from your bank account by IFS starting the following month. There will then be two additional payments in the policy period (bringing the total number of payments to 12) – these payments (# 11 and #12) will be applied to the policy renewal. If all your payments clear and you cancel the renewal, you will receive these last two payments back as a cancellation refund.

Example

Policy effective January 1
Total amount financed = policy premium of $1200 + non-standard financing fee (outlined on your financing contract) = $1,284
Downpayment = $1,284 x 25% = $321
Payments = $1284 divided over 10 equal payments = $128.40 monthly

January 1 – $321.00 (down payment paid directly to Cheep Insurance)
February 1 – $128.40
March 1 – $128.40
April 1 – $128.40
May 1 – $128.40
June 1 – $128.40
July 1 – $128.40
August 1 – $128.40
September 1 – $128.40
October 1 – $$128.40
***November 1 – $128.40
***December 1 – $128.40 (goes towards the policy renewal – if you cancel the renewal, these payments will be refunded)

Facility Monthly Payment Plan

The Facility Monthly Payment Plan is for all policies set up through the Facility Association. A higher financing fee is applied to your total policy premium, which is then divided over 12 equal payments. The first payment is a double downpayment, which is is paid directly to Cheep Insurance when the policy is set up. The subsequent monthly payments are withdrawn from your bank account automatically each month by IFS starting the following month. The 12th payment of the policy period goes towards your policy renewal.

Example:

Policy effective January 1
Total amount financed = policy premium of $1200 + non-standard financing fee (outlined on your financing contract) = $1272
Payments = $1272 divided over 12 equal payments = $106 monthly
Downpayment = double payment – $106 x 2 = $212

January 1 – $212 (down payment paid directly to Cheep Insurance)
February 1 – $106
March 1 – $106
April 1 – $106
May 1 – $106
June 1 – $106
July 1 – $106
August 1- $106
September 1 – $106
October 1 – $106
November 1 – $106
***December 1 – $106 (goes towards the policy renewal – if you cancel the renewal, this payment will be refunded)

How do I contact IFS?

You can contact IFS for payment-related questions (ex. changing a payment date, making up a missed payment, etc.) at 902-481-6106 or [email protected].