Tech-savvy Alpha Direct Agency Gets Digital Payment Processing Right

Alpha Direct Agency doesn’t just embrace InsurTech. Technology is one of their core values: “Driven to Win with Technology”.

The 17-year-old agency even offers (among other specialty lines) technology services insurance and drone liability. Licensed in 17 states, Alpha Direct Agency has offices in New York City, Raleigh and Miami, plus international presence in the Dominican Republic and soon in Ecuador. Clearly, technology is critical to the agency’s revenue, as well as connecting its producers to each other and to the flagship office in upper Manhattan.

Asked about his agency’s use of InsurTech solutions, Principal Emmanuel Osuyah chuckles. “We are the earliest of adopters! People look to me before they buy new software. They know if I’ve used it and recommend it, it’s going to work.” 

It’s not surprising, then, that Alpha Direct Agency started offering digital payment processing way back in 2006. Notwithstanding his agency’s international footprint, Emmanuel describes his agency as locally focused. “Customers would literally take the elevator up with baby carriage in tow to find our suite.” Most paid in cash or by money order. But carrying large amounts of cash around is a hassle. And, says Emmanuel, “the cashless world has forced change on all of us.” About the decision to offer online payment, he notes: “There was a time when if you could process ACH (check) payments, you were king. We had to go there.” As for credit cards, Alpha Direct Agency is “all plastic all day long.”

He tried out a series of payment processors over the years before becoming an early adopter of ePayPolicy (which he fondly refers to as “ePay3”). As one of ePayPolicy’s first clients, Emmanuel is clear about why he made the move: batching and fees.

None of his previous vendors had the capability to separate transaction fees as ePayPolicy does. He had to reconcile their fees monthly, decidedly “batch unfriendly.”

Prior to Insurance, Emmanuel worked as a banker, where he had to triple count cash for verification (those were the days before the desktop teller machines). When he founded his agency, he was no stranger to triple counting cash late into the night; and that’s when he knew there had to be a better way. With other merchant services vendors, he would take a month-and-a-half to reconcile credit card payments. Some vendors have two separate portals for credit cards and ACH transactions; which necessitates two different logins. In contrast, with ePayPolicy, mid-month and at the end of the month, his bookkeeper would run the reports, and “the transactions are right there. Both credit cards and ACH in the same transaction summary. With another click you hop into the batches. It’s so smooth, with easily searchable fields, which gives us more time in the month to focus on other things.”

Agent Reaction to ePayPolicy

His agents like the payment portal also. He says, “I lean on my 15 employees for feedback. My people were complaining about the old platform.” The Agents particularly like that refunds to customers are easy with ePayPolicy. Confirmation of the refund can be sent to the customer from the platform within minutes of processing, saving them from having to take follow-up calls about the refund’s status.

The ePayPolicy Experience

The transition from the previous payment processor vendor was smooth. ePayPolicy integrated easily with Alpha Direct Agency’s website. Emmanuel shares that, “right off the bat, I was impressed with the seamlessness of it all. My logo was in the portal, access to reports was painless and payments were hitting my bank account in the expected time frames.”

Emmanuel also gives thumbs up for:

  • Ease of payment (a big plus in redirecting customers away from cash payments)
  • Speed of payment (frees up agents to spend more time on sales)
  •  Web 2.0 friendly (it offers a clean look without a lot of “gibberish” on the screen)

Alpha Direct Agency hasn’t had to lean on ePayPolicy’s Customer Service often, but they’ve been very responsive when called or emailed. He cites this example: “Our customers know immediately when a transaction fee shows up in their account. Disputes are rare. But one customer contested a fee, even though he knew he was in the wrong. ePayPolicy shut it right down once we provided supporting documents.”

The “fees” theme continued throughout the interview. Emmanuel finds ePayPolicy’s flat fees for ACH transactions ($3 per) a major benefit. He recently had another vendor pitch him, but they charge a percentage of the ACH transaction. Needless to say, that company will not be getting the Emmanuel Osuyah stamp of approval.

Next Steps for Alpha Direct

Alpha Direct does not currently use the invoicing function, but Emmanuel looks forward to implementing it. In addition, he’s excited to know that ePayPolicy’s platform has plans to integrate with his agency management system (Hawksoft).

Advice to Other Insurance Agencies

To any agencies out there researching digital payment processors or dissatisfied with their current vendor, Emmanuel Osuyah does not mince words:

“Sign up with ePayPolicy. Go straight to where the future’s at.” 

How Much Are Paper Checks Costing Your Agency?

In your office, do you send coworkers letters instead of emails? Do you hand-write invitations to meetings and deliver them to everyone’s desk? Do you post physical to-do lists on everyone’s office door? Then why would someone hand-write and mail paper checks?

How Much Are Checks Costing Your Insurance Agency? 
In the digital age, people avoid paper materials due to the inefficiencies. Physical transactions waste time and money, create the possibility for confusion, and are an unnecessary use of resources. Now, 80% of businesses are seeking ways to convert paper checks into digital payments. 

So, are paper checks outdated? Yes. In fact, it’s possible for banks to consider them “stale” after only a few months. The Federal Reserve Study estimated 28 billion checks were processed in 2009 with a decline of 1.2 billion every year since. At this rate, they estimate paper checks will become extinct by 2026. 

While the need for paper checks is shrinking, the cost is not. In a study conducted by the Aberdeen Group, $7.78 was the average cost of a paper check, while Bank of America reports a cost of $4 – $20 factoring in mailing and processing. Bottomline showed processing a check costs a business ten times more than an ACH transfer, and receiving a check costs five times more than an ACH payment. That’s a lot of money being spent on receiving money. 

Let’s Talk About The Customer Experience
Customers crave flexibility, convenience, and speed. Paper checks cost them all three. They don’t want to reach for a checkbook, pen, envelope and stamp before running to the mailbox just to make a payment. The same Federal Reserve Study states paper check usage has decreased by 7.2%, and debit and credit card payments have increased by 8.9%.

We live in a world where there are online services for everything. Customers want and need, to be able to pay for their insurance from anywhere at any time. Slow payment systems like the paper check increase wait times and add the layer for human error to the process.

The Security Risks That Come with Paper Checks 
Paper checks increase the customers risk for fraud and identity theft. In its 2015 Deposit Account Fraud Survey, the American Bankers Association says that check fraud accounted for 32 percent of the industry’s $1.91 billion in losses in 2014. The sheer number of times a check must be passed from hand to hand while it is being processed means there is less and less security available. This also implies an increased risk for your agency to even receive the payments. 

The mail itself offers little security, and someone could easily steal the bank account and routing numbers for an account from a physical check. Your customers trust you with their largest assets and the safety of their banking information. Digital processing creates a secure environment to receive payments and keep accurate records while eliminating these risks.

The Environmental Impact
A growing consumer concern over the last decade has been the environment and our negative impact on it. Customers like to know the companies they do business with are green-conscious.

Take paper receipts for example. Have you noticed a trend of customers saying no to printed receipts and receiving them electronically? People view paper checks as equally not preferable. The check creation process involves water, gas, trees, and releases greenhouse gases. Once the check is processed, it will most likely end up in a landfill, adding to more waste. Moving to a greener, digital solution will not only create positive PR but will have a powerful effect on the environment. 


Have questions on how you can move away from paper checks? Reach out and schedule a demo to learn why ePayPolicy is the simplest solution for you to collect credit card and ACH payments for your insurance agency.

Studies used for this posting include…
The 2019 Federal Reserve Payments Study
2019 AFP Electronic Payments Survey
What is Check Fraud 

Finding The Perfect Payment Processor For Your Agency

“It’s not us, it’s you.” Several insurance agents that use large payment processors (operate in multiple verticals) have reported being kicked off their payment processor, with no other explanation than “our product is not a good fit for your industry.” Well, their loss is potentially your gain. We can’t tell you exactly why these companies are rejecting business from the insurance industry. But we have some educated guesses. Even better, we have a solution! First and foremost, the insurance industry is highly regulated and involves a lot of tracking funds for compliance purposes. Some payment processors are designed for straight sales transactions. They simply can’t handle the additional levels of accounting and code compliance the insurance industry demands, in other words, they don’t speak insurance. “Not a good fit” is their way of admitting they’re not set up for a complex, regulation-driven industry like insurance. Here are some likely reasons why they might be rejecting business from insurance agencies:

Insurance Code Mandates and Trust Account Management

Most vendors who use a large multi-vertical payment processor have a simple business model: receive payment in exchange for goods or services provided. It’s straightforward. No fancy accounting required. Think coffee shops, digital storefronts, hotdog guy at the block party. But not the insurance industry. As you know, premium payments in some states are subject to insurance code regulations. When you receive premiums you are operating in a “fiduciary” capacity. You are not the “owner” of the premiums paid but are acting as a fiduciary of those funds.  As such, you must keep premiums in separate trust accounts that are segregated from the agency’s business operating funds. This is to protect premium funds from agency creditors. And you can’t take them out of the trust account without proper documentation of the commission earned and an audit trail, either. Truth be told, general payment processors are not set up for this level of sophistication. Volume, yes. Sophisticated accounting, no. Trust account (TA) management is a huge responsibility with potentially heavy consequences. You need a payment processor that understands the “ins and outs” — which, for insurance agents, involves more than simply depositing money from the client into your agency account, or even passing it directly through to the carrier! Terms like net funding and premium funds should sound familiar. 

State Compliance and Regulations 

Each state has its own set of regulations for selling insurance. The requirements in Ohio may be different from those in New York, California or Florida. That’s one reason why the trusted choice / BIG I associations are so valuable. They keep you on track to maintain compliance with any and all state-specific mandates. Needless to say, the big global payment processing companies are not operating at this micro (state regulations) level.  But you are. And so are we at ePayPolicy. We maintain close relationships with the Big I / Trusted Choice state insurance associations nationwide and are in the process of getting all 50 states endorsements. Their stamp of approval is their way of saying, “This vendor gets it. We trust them. You should, too.”

An insurance Industry-Specific Solution

I’ve kind of hinted at the solution in the “issues/problems with general payment processors” sections above. Yes.  I am talking about ePayPolicy — the insurance payment processing platform built specifically for independent insurance agents. We are not a general-purpose payment processor. We are a payment processor that was built by insurance professionals for insurance. We work exclusively with and for the insurance industry. By focusing on your business needs, as well as the highly regulated nature of insurance, we have created an ecosystem that streamlines your operations while ensuring compliance across the board. Check out ePayPolicy. We make collecting credit card and ACH payments as easy as possible and to get started takes only 5 minutes. 

The Independent Insurance Agents and Brokers of America: BIG I Client Spotlight

Customer Spotlight:

The Independent Insurance Agents & Brokers of America

Executive Summary: 

The Independent Insurance Agents & Brokers of America is a national alliance of more than a quarter million business owners and their employees who offer all types of insurance and financial services products.

The Goals: 

Reduce paper checks,  streamline payment processing and bind policies faster.

The Results:

 No one understands the importance of expediency in the insurance industry quite like accounting employees. The ability to quickly track and reconcile payments effectively speeds up receivables and bind policies faster, things that typically improve an agency’s overall bottom line. For Annette Mertz, the VP of Accounting for IIABA, the biggest issue she was experiencing before signing up with ePayPolicy was timing. “We don’t have binding authority until we receive a payment,” said Mertz. “Typically it takes anywhere between three to seven days to get a paper check in the mail, which creates issues when you’re trying to bind quickly,” she said. After IIABA signed up with ePayPolicy, a lot of those issues faded. Not only do ePayPolicy customers like IIABA receive their funds in one to two business days (up to three times as fast as a paper check), they can rest easy knowing their payment is being routed to the correct place.


“ePayPolicy is one of those products that is so easy you expect it to be more complicated but it’s not. You have to pinch yourself to realize there’s really a product like this.” – Annette Mertz,  VP of Accounting, IIABA

There are a lot of potential errors with manually sending in a payment, for instance, sending a check to the wrong address or issuing it to the wrong person. “These things are eliminated now that we use ePayPolicy,” said Mertz. The ease of using ePayPolicy as one of the payment processor’s biggest draws. By focusing strictly on the insurance space, ePayPolicy is able to keep its product and services incredibly simple and straightforward. And for insurance professionals like Mertz, simple is King. “ePayPolicy makes day to day operations incredibly easy,” said Mertz. “You know right away if customers make a payment and we’re getting receivables much faster. We don’t have to wait on paper checks anymore.”