---
title: "Agency Bill Collections: Chasing Unpaid Premium Without Losing Commission — Lapidar"
url: https://getlapidar.com/guides/agency-bill-collections/
description: "A collections routine for agency bill business: account current due dates, net remittance, what happens when the insured doesn’t pay (cancellation and returned commission), a weekly receivables aging review, and premium trust account basics. General information, not legal advice."
last_modified: "2026-10-13"
source: getlapidar.com (HTML converted to Markdown at the edge)
---

Guide · 6 min read

# Agency bill collections: how to chase unpaid premium without losing commission

**Short answer.** On [agency bill](https://getlapidar.com/glossary/agency-bill/) business you invoice the insured, keep your commission and remit the net premium to the carrier by the due date in your agency agreement, often whether or not the insured has paid. To protect the commission, invoice promptly, review receivables by age every week against the next [account current](https://getlapidar.com/glossary/account-current/) due date, warn the insured in writing with a date, and if payment still doesn’t come, ask the carrier to cancel within the time your agreement allows. Commission on premium that is never collected is usually given up, and on a cancellation the unearned part comes back. Collected premium is generally held in trust; how depends on your state (see [premium trust account](https://getlapidar.com/glossary/premium-trust-account/)). This is general information, not legal advice.

[Open an account — founding pilot](https://app.getlapidar.com/signup) [See a sample report](https://getlapidar.com/sample-report/)

The account current has a due date. Your client’s invoice has one too. Collections means getting the client’s money in before the carrier’s date.

By Lapidar, the team building it · October 13, 2026

## TL;DR

- The carrier’s due date doesn’t move because your client is late. Your agreement sets what you owe and when.
- Net remittance means premium collected less your commission. Commission on premium you never collect is usually given up.
- Only the carrier can cancel for nonpayment (unless the insured gave you power of attorney), so collections ends with a request to the carrier, inside the agreement’s window.
- A weekly aging review, sorted by the next account current due date, is the routine that keeps unpaid items from becoming your agency’s loss.

This guide is for people at US independent P&C agencies who run agency bill receivables: owners, bookkeepers and account managers. It covers the collections routine between your invoice and the carrier’s due date. How to check the account current line by line before you remit is in [agency bill reconciliation](https://getlapidar.com/guides/agency-bill-vs-direct-bill-commission-reconciliation/); what agency bill timing does to cash is in [insurance agency cash flow](https://getlapidar.com/guides/insurance-agency-cash-flow/). Nothing here is legal advice. Collection practices, cancellation notices and trust accounting are governed by your agency agreements and state law.

## When is the account current due?

An account current is, in Insuranceopedia’s definition, “a financial report issued by an insurance company to an insurance agent” that “details the transactions made during a specific period, including premium payments, commissions, approved policies, and canceled policies” ([Insuranceopedia](https://www.insuranceopedia.com/definition/573/account-current)). The date you must pay it is set by your agency agreement with each carrier, not by this guide or by custom. Write down, for each agency bill carrier, when the statement arrives, when payment is due, and what the agreement says about premium you haven’t collected yet. That list is the calendar your collections work runs to.

## What is net remittance, and where does your commission come from?

On agency bill you collect the gross premium, keep your commission, and remit the rest. Your commission is therefore paid out of money you collect. If an invoice goes unpaid, you have nothing to keep commission from, and under many agreements you still owe the net. That is why collections, not the commission rate, is often what decides whether agency bill commission ends up in the bank. Checking that the net on the account current is right, line by line, is covered in [the reconciliation guide](https://getlapidar.com/guides/agency-bill-vs-direct-bill-commission-reconciliation/#in-order).

## What happens if the insured doesn’t pay?

Big “I” Virtual University faculty, answering an agency’s question, wrote: “Unless the insured has given the agency Power of Attorney only the company can cancel a policy for nonpayment,” and “Usually, you give up commission on the uncollectible balance” ([Big “I” VU](https://www.independentagent.com/vu_resource/can-agencies-cancel-agency-billed-policies/)). The full discussion, including “days for returning” clauses and premium your agency has already fronted, is in [when the insured hasn’t paid](https://getlapidar.com/guides/agency-bill-vs-direct-bill-commission-reconciliation/#not-paid); we won’t repeat it here.

What follows for the commission:

- **If the policy is cancelled**, the earned premium is what the insured owes for the time covered. The carrier credits the unearned premium net of commission, so your commission on that part reverses, usually on a later account current. Carrier cancellations for nonpayment are usually pro rata (short rate generally applies when the insured asks to cancel), but the policy governs; see [commission chargebacks explained](https://getlapidar.com/guides/commission-chargebacks-explained/).
- **If you already remitted**, the carrier has been paid, and the Big “I” VU faculty doubt it can still cancel for nonpayment, so the whole unpaid amount may be yours to collect or lose (see [when the insured hasn’t paid](https://getlapidar.com/guides/agency-bill-vs-direct-bill-commission-reconciliation/#not-paid)).
- **Audits and endorsements** billed after the fact are the hardest to collect; [unpaid audit premium](https://getlapidar.com/guides/commission-on-premium-audits/#uncollected) has its own section.

## How do you run a weekly receivables aging review?

Aging means sorting open invoices by how long past due they are. The buckets below are a common convention, not a rule; pick yours and keep them steady.

1. **Pull open agency bill invoices** from your agency management system, by insured, policy, amount, invoice date and due date.
2. **Bucket them**: not yet due, 1–30 days past due, 31–60, over 60.
3. **Add the carrier’s next due date** beside each item. An invoice that is only a week late but sits on an account current due in three days matters more than an older one on a carrier you pay next month.
4. **Assign an action and a date** to every past-due item: reminder, call, written warning, request to the carrier.
5. **Check the agreement window.** If your agreement lets you return unpaid items within a set time, mark the last day for each, so the decision is made before the window closes, not after.
6. **Record outcomes**: paid, promised by a date, returned to the carrier, cancellation requested, written off. Carry open items to next week.
7. **Before you remit**, compare the list with the account current, so returned or cancelled items are reflected and nothing is paid twice.

## How should you chase the insured?

Many late payers are late, not refusing. Start with a plain reminder that names the policy, the amount and the date it is needed, then a call. If that fails, another response on the same Big “I” VU page recommends that “the insured should be warned that cancellation will be requested if payment is not received by a given date” before you ask the carrier to send notice ([Big “I” VU](https://www.independentagent.com/vu_resource/can-agencies-cancel-agency-billed-policies/)). Keep the warning factual and keep a copy. Don’t threaten a cancellation you can’t request, and don’t state when coverage will end: notice periods are set by the policy and state law, and the carrier’s notice sets that. For a commercial client, ask whether the problem is cash or a dispute about the bill; a disputed audit or endorsement is a question for the carrier and the insured, and should be raised with the carrier before the account current is due.

## Where should collected premium sit until you remit?

In many states premium your agency collects is not your money. Florida’s statute, for example, says premiums, return premiums and other funds belonging to insurers or others received by an agent or agency “are trust funds received by the licensee in a fiduciary capacity” ([Florida Statutes §626.561](https://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0600-0699/0626/Sections/0626.561.html)). States differ on whether a separate account is required, when commission may be withdrawn, whether interest may be kept and what records are needed; the [premium trust account](https://getlapidar.com/glossary/premium-trust-account/) entry outlines the common questions. Paying one carrier with premium another client paid for a different policy is what fiduciary rules are aimed at. If you cover a shortfall with agency money, record it as that. Ask your state department (through the [NAIC directory](https://content.naic.org/state-insurance-departments)) and your accountant how yours treats it.

## What changes when the premium is financed?

When a client uses [premium finance](https://getlapidar.com/glossary/premium-finance/), the finance company pays most of the premium and the client owes the finance company instead. Your receivable becomes the down payment and the finance company’s funding, and if the client stops paying the finance company, it may cancel the policy under the power of attorney in the finance agreement, with commission coming back on the unearned part. Match each finance payment to the invoices it covers, as your aging list would.

## Where Lapidar fits

Lapidar doesn’t collect premium or chase clients. It is built to check carrier statements and account currents line by line against your book and your schedules, and to flag missing, underpaid and paid-twice commission. It is in its founding pilot, it has no customers yet, and we’ll say so until that changes.

## Frequently asked questions

### Do I have to pay the carrier if my client hasn’t paid the agency bill invoice?

Often yes, by the account current due date, but your agency agreement decides. Read its payment terms and any clause that lets you return unpaid items to the carrier, and act before that window closes.

### Can my agency cancel a policy for nonpayment?

Generally not by itself. Big “I” VU faculty note that, unless the insured has given the agency power of attorney, only the company can cancel a policy for nonpayment. The agency asks the carrier, after warning the insured.

### Do I lose commission if the insured never pays?

Usually on the uncollected balance, yes. If the policy is cancelled, commission on the unearned premium comes back to the carrier, typically as a negative line on a later account current.

### Where should collected premium be kept?

In many states it is held in a fiduciary capacity, often in a premium trust account. Rules differ by state, so check your state’s insurance department and your accountant.

## Sources

1. Insuranceopedia, [Account Current](https://www.insuranceopedia.com/definition/573/account-current), undated. Retrieved October 13, 2026.
2. Big “I” Virtual University, [Can Agencies Cancel Agency-Billed Policies?](https://www.independentagent.com/vu_resource/can-agencies-cancel-agency-billed-policies/), 2012. Retrieved October 13, 2026.
3. The Florida Legislature, [Florida Statutes §626.561, Reporting and accounting for funds](https://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0600-0699/0626/Sections/0626.561.html). Retrieved October 13, 2026.
4. National Association of Insurance Commissioners, [Insurance Departments](https://content.naic.org/state-insurance-departments). Retrieved October 13, 2026.

Lapidar is [commission reconciliation software for independent insurance agencies](https://getlapidar.com/), in its founding pilot. Related: [premium trust account](https://getlapidar.com/glossary/premium-trust-account/) · [account current](https://getlapidar.com/glossary/account-current/) · [agency bill](https://getlapidar.com/glossary/agency-bill/) · [premium finance](https://getlapidar.com/glossary/premium-finance/).

In this guide

1. [Account current deadlines](https://getlapidar.com/guides/agency-bill-collections/#deadlines)
2. [Net remittance](https://getlapidar.com/guides/agency-bill-collections/#net)
3. [When the insured doesn’t pay](https://getlapidar.com/guides/agency-bill-collections/#not-paid)
4. [Weekly aging routine](https://getlapidar.com/guides/agency-bill-collections/#aging)
5. [Chasing the insured](https://getlapidar.com/guides/agency-bill-collections/#chasing)
6. [Trust account basics](https://getlapidar.com/guides/agency-bill-collections/#trust)
7. [Premium finance](https://getlapidar.com/guides/agency-bill-collections/#finance)
8. [Where Lapidar fits](https://getlapidar.com/guides/agency-bill-collections/#where-lapidar-fits)
9. [Frequently asked questions](https://getlapidar.com/guides/agency-bill-collections/#faq)
10. [Sources](https://getlapidar.com/guides/agency-bill-collections/#sources)

See how a reconciliation report totals missing, underpaid and paid-twice commission by carrier.

[See a sample report](https://getlapidar.com/sample-report/)

## Check every statement line against your book.

Every carrier formats its statements differently, and the lines rarely match your records on the first pass. Lapidar checks each statement line by line against your book and flags missing, underpaid and paid-twice commissions. [See a sample report](https://getlapidar.com/sample-report/), or read [how the founding pilot works](https://getlapidar.com/pilot/).

[Open an account — founding pilot](https://app.getlapidar.com/signup)

[See a sample report](https://getlapidar.com/sample-report/)