The Paulmar business model is a trust account outsourcing model whereby the agency continues to sell and service while the trust account operation is carried out by the outsourcing partner. The current agency business model illustrates the flow of premium dollars going through the agency trust account. Before it can be transferred to the agency business operating account, the agency commission must be processed in accordance with Insurance Code requirements.
Some agencies choose a direct bill (DB) business model. The agency sells and services policies but its commission income is received from the insurance carrier generally after premium payments are made by insureds.
The Paulmar model offers the benefits of both agency bill and direct bill models. While the agency continues to sell and service its commission income is processed in-house by the outsourcer and made available as soon as payments are received from insureds. This model is similar to the standard sales and service operation model.
