Method of administering automobile insurance premium finance contract asset-backed securities

• US 20050096945A1
• Filed: 11/03/2004
• Published: 05/05/2005
• Est. Priority Date: 11/04/2003
• Status: Abandoned Application

• Current Assignee: Arthur L. Wharton III
• Original Assignee: Arthur L. Wharton III
• Inventors: Wharton, Arthur L. III
• Application Number:
  US10/979,278
• Publication Number:
  US 20050096945A1
• Time in Patent Office: Days
• US Class Current: 705/4
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

The improved fiscal method in which automobile insurance premium finance contract asset backed securities (ABS) use the automobile insurance premium finance contracts as the underlying collateral for the ABS. The automobile insurance premium finance contract is an asset because it is associated with the right to receive cash flows. The securities would be short-term, medium-term or long-term debt instruments. Using automobile insurance premium finance contract asset backed securities will provide a continuous supply of lower cost capital from the capital markets to premium finance companies that provide a financial means in which the automobile insurance premium contracts to the consumers and businesses that finance automobile insurance premiums. With this steady supply of lower cost capital from the capital markets, the actual rates charged on automobile premium finance contracts to consumers and businesses could decline. This process can be implemented manually and/or electronically via computer by a LAN or WAN.

Claims

1. An improved computer implemented fiscal method of administering automobile insurance premium finance contracts comprising the steps of:

a. directing premium finance companies to sell automobile insurance premium contracts to special purpose entity and entering into a servicing agreement;

b. packaging electronically automobile insurance premium contracts into securities by special purpose entities in which said securities are backed by automobile insurance premium contract cash flows and sold to investors as assets;

c. receiving payments electronically from an insured party in which payments are forwarded to said asset-backed security issuing entities minus an agreed upon servicing fee;

d. collecting cash flows for special purpose entities from said premium finance companies;

e. distributing payments from said special purpose entities to asset-backed security investors in accordance with the Automobile Insurance Premium Finance Contract Asset-Backed Security'"'"'s payout provisions.

2. The improved computer implemented fiscal method according to claim 1, wherein said Automobile Insurance Premium finance contracts are manually packaged into securities by special purpose entities in which said securities are backed by Automobile Insurance Premium Finance Contract and sold to investors.

3. The improved computer implemented fiscal method according to claim 2, further comprising Automobile Insurance Premium Finance Contract that function as the underlying collateral for Automobile Insurance Premium Finance Contract Asset-Backed Securities.

4. The improved computer implemented fiscal method according to claim 3, wherein Automobile Insurance Premium Finance Contract Asset Backed Securities are short-term, medium-term or long-term instruments.

5. The improved computer implemented method according to claim 4, further including shot-term instruments having maturities from one year or less;

medium-term instruments from 1 year up to 10 years;

long term instrument having maturities greater than 10 years.

6. The improved computer implemented fiscal method according to claim 3, wherein said Automobile Insurance Premium Finance Contract Asset Backed Securities lower the cost of capital to premium finance companies.

7. The improved computer implemented fiscal method according to claim 3, wherein said Automobile Insurance Premium Finance Contracts are assets that generate cash flows.