Insurance Premiums, Credit Card Payments and Refunds

How to Refund a Card Payment

Insurance always has to be different. If you are in the business, you know what I mean.

How do you handle a premium refund if the premium was paid to your agency with a credit card?

What the Card Rules Say

Under the Rules, any payment accepted as a card payment must be refunded through a credit to the cardholders credit card account.

Why?

To protect you from refunding the money twice!

How Does A Double Refund Happen

Since the cardholder can always dispute and reverse the card payment they made to pay the premium originally, the cardholder can, in effect, get a refund without ever asking you about a refund.

The cardholder disputes the charges and the card company automatically credits the amount of the payment back to the cardholder and takes the payment amount out of your bank account. (Yes, you agreed to this when you signed your Merchant Agreement.)

NOTE:Disputes are rare for insurance premium payments.

If you make a refund that is not through a credit back to the cardholders card account, the credit card company has no record of any of this refund. Since they do not know you have done this, their software will allow your customer to dispute the charge and automatically provide a refund credit.

How Can You Prevent This

 If you have refunded this payment through the card network, the card company will see that reversal and will not allow a dispute of the charge since the cardholder has clearly already received a refund.

Simply Easier Payment's Refund Feature

Your Simply Easier Payments account lets you void a full payment or do a partial refund.

Your do this from the Report function. Check out our help section or call and ask us how if you need help in learning how.