Professional loan facility settles indemnity and VAT bill shortfall

Professional Indemnity Insurance can be one of the largest single payment obligations a professional practice needs to make in a calendar year and finding the best insurance provider is only half the battle for many legal firms. Identifying the appropriate funder to finance the insurance premium is no easy task when looking to balance a practise’s market exposure and obtain the best possible deal for the client.

United Trust Bank was approached by one of our partner introducers, a specialist professions broker, to address the funding requirements of a 3 partner London law firm looking to fund their full 12 month premium, equating to around 10% of their annual fees. After receiving a comprehensive introduction to the client we were quickly able to approve the PII expenditure requirements and also advise the broker that we had further appetite to
lend to their client. The broker had already identified that there were additional working capital requirements for this practise in September as they were just emerging from one of their most successful quarters of the past 4 years and had a hefty VAT bill due to HMRC payable in the next 10 days.

We were able to provide the client with all of their September funding requirements, at a highly competitive rate, within in a short timescale. We gave them certainty that their insurance provider would be paid on time and that there remained strong cash balances within the firm at a time when the previous quarter’s success could have been over-shadowed by a working capital shortfall. At the last moment the client quickly requested an additional amount over and above our previous acceptance to cover all of their VAT shortfall and we were able to agree to and provide documentation within a matter of hours.

The client was able to focus all of their efforts on maintaining their high fee performances and utilising their cash in areas that would generate additional fee income to ensure the continued progression of their firm. The result was a satisfied customer, broker and funder.

Loan advance: £310k
Loan Purpose: Professional Indemnity Insurance premium & VAT
Loan Term: 12 months and 3 months respectively