SCinsurance Nov 12, 2007 4:54 PM
I am a new agency that would like to offer the ability to accept credit cards. I have the credit card info ready and understand I will be charged a monthly fee of $15 plus 1.24% per transaction.
In SC I know I can accept credit cards but can I charge that client the 1.24% as well or do I have to write that off as cost of business?
Is anyone else doing this and do they have any 'forms' that explains to the insured that in addition to their premium there is a 1.24% charge for 'processing"
volstrike3 Nov 13, 2007 1:20 PM
Sounds complicated. We offer CC payments and just take the hit. Most people who pay by CC are non standard auto and they are getting hit with a broker fee anyway so I would not bother with the 1.24% charge, just charge a standard broker fee.
wlunday Nov 13, 2007 2:12 PM
Almost every carrier will accept CC payments. They deal with enough volume to avoid any CC fees. Just use their system. Also puts the risk onto the carrier if a charge is declined or later charged back by the CC company. I'd hate to have to pay an earned premium because a customer backed out of a transaction!
mesparza Nov 21, 2007 12:34 PM
I have heard that it is illegal to pass on the percentage fee to the customer, but it is ok if you call it a handling fee (Must be fixed). We used to pass on the percentage per transaction, but now me just call it a handling fee ($5, $10, $15, etc.)
anirrg Nov 26, 2007 1:51 PM
You need to read the agreement that you signed with the Credit Card processing Company.
In most cases you are not allowed to pass on the Credit Card Charge to the customer. In most cases it's a contractual agreement (like the one you signed) and not a law.
In most states you can charge a brokers fee, which is subject too your states regulations on charging brokers fees.
Don't charge any fee's or Credit Card charges to your client until you know what is allowed. It is far better to find out now than later, especially if you have to regurgitate the last 3 years of monies back to each customer.
tuffdeal Dec 7, 2007 1:51 PM
You might offer a sponsored Debit card like Tapco does instead of getting into problems with credit risk.
Your concept is good but do it cleanly.
