Premium funder IQumulate will launch an alternative payment plan for clients this week, parent company Steadfast says in a presentation released to the Australian Securities Exchange.

Steadfast also says that, to date, there has been minimal take-up by clients of premium deferrals being offered by insurers amid the coronavirus outbreak.

As insuranceNEWS.com.au has previously reported, the insurers’ offer caused considerable debate in the broking community, with many questioning the value to their clients of deferred payments and raising the likely financial impact on their own businesses.

Steadfast’s funding plan is expected to follow the lines of a strategy mooted by senior brokers immediately after the insurers’ initiative was announced.

The brokers’ plan was mentioned at a presentation prepared for the Goldman Sachs Emerging Leaders Conference.

IQumulate became fully owned by Steadfast in March last year after the broking network acquired the 50% it didn’t already own from Macquarie Bank. The business provides funding solutions to more than 60,000 firms in Australia and New Zealand.

The Steadfast presentation says that in the current climate the group will benefit from product line diversity and its exposure to areas such as strata and machinery.

Strata is not an optional buy, as the law requires building insurance, claims from recent catastrophes continue to drive property premium increases, and machinery and plant is likely to benefit from more infrastructure spending, Steadfast says.

Strata contributes 22% to earnings before interest, tax and amortisation (EBITA) and machinery and plant provides 12%.

“While we are trading in an unprecedented economic environment, Steadfast is a stable and resilient business,” it says.

Steadfast says micro-businesses represent 2% of Steadfast Broker Network gross written premium, while Government stimulus measures will assist small enterprises.

The group’s nine-month results, released last month, included a $2.9 million impact from the cancellation of this year’s Steadfast Convention, but COVID-19 had no other material impacts in the March quarter.

Premium rises for the quarter were 7.3%, it says.