Nonadmitted Assets for Insurance Companies’ Financing

What Are Non-admitted Assets?

Most large companies using standard accounting practices report equipment as assets. Non-admitted assets are generally illiquid equipment like:

computers
workstations
cubicles
software
lighting
copy machines
shredders
proprietary systems

These are assets on the company balance sheet and depreciated according to preset schedules. Insurance companies must always maintain a high liquidity levels. They can liquidate cash and assets to cover large losses, like natural disasters, that impact policyholders. State Insurance Regulators classify these as non-admitted assets as they can’t easily convert to cash. If an insurance company has enough cash to cover loss ratios, there is no issue. Otherwise, Equipment Leases buys all or some assets and leases them back in a complex Sales-Leaseback transaction.

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Minimum 1-year in business

What Equipment do you Typically Lease to Insurers?

Workstations
Executive Desks
Secretarial Desks
Cubicles
Appliances
Phone Systems
Computers
Servers
Office Fixtures
Board Room Furniture
Fax Machines
Scanners
Lobby and Entry Furniture
Wall Décor
Enterprise Software
Proprietary Software
Digital Copy Machines

Insurance Company Equipment Financing and Leasing

Major natural disasters cause an increase in claims for large losses.

Each state has a regulator who monitors insurance companies to ensure they have NAIC compliance. Regulators check if insurers have enough reserves to cover claims. They also ensure surplus ratios meet required levels.

AM Best ranks an insurer’s financial health. A lower rating can affect the insurer’s ability to attract investments or borrow money. To avoid a lowered rating, insurers have options like insurance company equipment financing and leasing.

NOTE: If you’re not an insurance company but want information about our Sale-Leaseback Financing Solutions, click here to learn more. We provide solutions for many industries from Medical Equipment and beyond.

Non-Admitted Asset Leasing Specifically for Insurance Carriers

Equipment Leases Inc. has the expertise and track record of nonadmitted assets for insurance company financing. We help them comply with their market’s surplus and reserve requirements.

Here’s how our non-admitted asset financial solutions can help:

We underwrote a $40,000,000 sale-leaseback of a carrier’s non-admitted assets.
Assets like enterprise software programming keep their risk ratios within strict guidelines, preserving their quality AM Best ratings.
Statutory filing line 20 EDP/Software and line 21 FFE are eligible for immediate Sale-leaseback.
We follow SAPP 22 Sales and Lease Back guidelines to provide 100% insurance company equipment financing on qualified non-admitted assets.

This process affects property and casualty carriers, health insurance underwriters, and auto carriers. Claims of all kinds can erode surplus reserves and lower risk-based capital ratio. Boosting surplus could stabilize an agency rating from AM Best, Fitch, or Moody’s.

We can provide leasing assistance of up to $50 million. The experts at Equipment Leases Inc. can design non-admitted asset financial solutions before year-end. Since activity typically increases in the fourth quarter, we recommend starting the process early.

Why Choose Equipment Leasing?

Equipment Leases Inc. and our insurance experts are experienced providers of large Sale-Leaseback transactions. Our expertise and investor network make us the go-to choice for major carriers, leading to repeat transactions when cash infusions are needed.

If a carrier’s risk-based capital ratio falls below state minimums, we are the best choice to resolve the issue quickly and efficiently within tight funding windows.

Note to Insurance Carrier CFOs: If you need a sale-leaseback for non-admitted assets up to $100 million or more, choose us. Our proprietary non-admitted asset financial solutions ensures we can handle all your needs, no matter how complex.