Understanding Billing Types in Momentum AMS

1️⃣ Direct Bill (DB)

Definition: The carrier or MGA collects the premium directly from the insured.
Agency Role: Track commissions only — no receivables or payables are created for the agency.

Key Details:

• ✅ The insured pays the carrier directly (e.g., Progressive Commercial).

• Customers may pay via website, phone, ACH, or Western Union.

• No invoices are created by the agency in Momentum AMS.

Pass-Through Payments:

If the insured brings a payment to the agency:

• Record it as a “Pass-Through Payment”

• No invoice or revenue is created — it simply reflects a forwarded payment

2️⃣ Direct Bill with Down Payment

Definition: The agency collects an initial down payment, while the remainder is billed by the carrier.

System Workflow:

• ✅ A receivable is created for the amount collected by the agency

• ✅ A payable is generated to reflect the amount owed to the carrier

• Used in cases where the carrier begins billing the remaining premium

3️⃣ Agency Bill – Paid in Full (PIF)

Definition: The agency collects the full premium from the insured and remits the net premium to the carrier after deducting commission.

System Workflow:

• The system creates a full receivable (amount owed to the agency)

• A payable is created (amount owed to the carrier)

• The invoice reflects the entire premium and is due to the agency

Example:

• Full premium = $1,000

• Commission = 15%

• Agency receives $1,000 → Remits $850 to carrier → Retains $150

4️⃣ Agency Bill – 100% Billed Monthly

Definition: The insured pays the agency monthly. The agency remits monthly payments to the carrier.

System Workflow:

• Each monthly premium installment is collected and tracked

• The agency must remit monthly payments to the carrier as collected

• Typically requires recurring billing templates and tight receivables monitoring

5️⃣ Agency Bill – With Outside Financing

Definition: A premium finance company (PFC) pays the carrier in full on behalf of the insured. The insured makes installment payments to the PFC.

System Workflow:

• The finance company pays the MGA or carrier upfront

• The system reflects only the down payment as a receivable from the insured

• Commission is calculated when the transaction is generated

Invoice Format:

• Only the down payment is billed to the insured

• Includes a note stating:
  “Remaining premium is financed. See attached PFA for terms.”

Common Finance Companies:

• U.S. Premium Finance

• IPFS

• Capital Premium Finance

Workflow Summary:

1. Access the policy

2. Update billing tab → Select "Agency Bill with Outside Financing"

3. Enter premium, fees, and taxes

4. Use billing templates if applicable

5. Generate transaction → Review receivable, payable, and commission

6. Confirm down payment and apply payments

7. Save and generate invoice

General Billing Workflow in Momentum AMS

Regardless of billing type, follow these system best practices:

Step 1: Select the Billing Type

When adding or editing a policy, choose the correct Billing Type in the Billing tab.

⚠️ You cannot change the billing type if there are existing billing items. You must first remove all line items.

Step 2: Generate the Transaction

• Enter premium + taxes/fees

• Click "Generate Transaction" to create:

  • Receivables (amount owed by insured)

  • Payables (amount owed to MGA/carrier)

  • Commission calculation

Step 3: Create the Invoice

• Navigate to: Documents → Invoices/Receipts

• Click Add New, select the appropriate policy

• Choose the outstanding receivable

• Finalize and save the invoice

Step 4: Process Payments

• Go to Invoices or Policy screen → Click Take Payment

• Enter payment method, date, and amount

• Momentum AMS updates financial balances and reconciles the account

Step 5: Monitor Aging Receivables

• Use the Aging Receivables Report to track unpaid balances

• Send reminders or initiate collection steps as needed

• Review agency cash flow and commission forecasting regularly

✅ Best Practices

• Use billing templates to apply standard fees and tax structures

• Always double-check policy billing type before issuing quotes or endorsements

• Regularly review receivable aging reports to reduce past-due accounts

• Document notes and upload copies of financing agreements or invoices as needed