Transfer prior term debits and credits to a renewal term

When BriteCore automatically renews policies, it:

  • Will transfer outstanding credits to the renewal term on the renewal effective date.
  • Won’t transfer outstanding debits to the renewal term.

Transfer debits across terms

By default, BriteCore doesn’t transfer debits from the previous term to the renewal term. However, if an administrator enables the move_cross_term_debits advanced setting, BriteCore will move outstanding debits to the following term upon renewal.

BriteCore will display the transferred debits on the renewal billing statements except when:

  • The last installment’s Cancel Date is after the Renewal Timeline setting.
  • The renewal is manually created a year in advance (outstanding invoices on the current term).
  • A payment is made after the renewal term has already started.

    Note: The previous debit transfers are soft-deleted, but if there is an outstanding balance on the prior term, then it will remain there since the term has already ended.

  • A policy is rewritten because it has only one term.

The move_cross_term_debits advanced setting allows clients to:

  • Move outstanding debits from the prior term to the renewal term.
  • Collect fees that weren’t previously collected when the Policy Cancellation Threshold exceeded the provisioned amount. For example, if the Policy Cancellation Threshold (Settings > Modules > Policies > Edit Policy Lifecycle > Non-Pay > Threshold) is set to $50, any fees below that amount will carry over for the client to collect.

To enable the move_cross_term_debits advanced setting:

  1. In the BriteCore menu, select Settings.
  2. In the Settings menu, select Advanced.
  3. On the Advanced Settings screen, in the Search for a Setting box, type move_cross_term_debits, and then select Search or press Enter/Return on your keyboard.
  4. In the move_cross_term_debits box, select True.

Outstanding debit on the previous term

When a policy renews, the renewal invoice doesn’t pick up the outstanding debit for the previous term, so if a previous term has an outstanding debit after the policy renews, the next payment is applied to the outstanding debit first.

Note: When the next payment is applied to the outstanding debit for the previous term, the first payment for the renewal term will be short, creating a debit on the renewal term.

Outstanding credit on the previous term

Any outstanding credits will be carried forward on the renewal effective date. Since the credit is not carried forward until the renewal effective date, the renewal term may also display a credit.

Migrating endorsements

When the move_cross_term_debits advanced setting is enabled, canceled endorsements will migrate to the renewal term when the Cancel Date is before the Renewal Billing Invoice generation date.

Endorsement Invoice Cancel Date is before Renewal Billing Invoice generation date

If an unpaid Endorsement Invoice, or Amended Billing Statement, for a policy contains a Cancel Date on or before the Renewal Billing Invoice generation date, then when the policy renews, the Endorsement Invoice will be migrated to the renewal term.

When an Endorsement Invoice is moved to the renewal term, the following will happen:

  • The previous term will display an entry in the Accounts History table, with the transaction Type labeled as Adjustment and the Summary description Debit Transfer Adjustment – Outstanding – Invoice.
  • This migration will modify the Trailing Balance to 0.00.
  • The Currently Due balance for the previous term won’t include the open Endorsement Invoice amount.
  • The open Endorsement Invoice amount will be migrated to the renewal term. A Debit Transfer entry will appear in the Account History table of the prior term with the Summary description, Transfer debit for outstanding: Invoice
  • The Currently Due balance for the renewal term will include the open Endorsement Invoice amount until paid.

Endorsement Invoice Cancel Date equals Renewal Billing Invoice generation date

If an unpaid Endorsement Invoice for a policy contains a Cancel Date after the Renewal Billing Invoice generation date, the renewal processing will retain the open Endorsement Invoice on the previous term. By default, the renewal term won’t display an entry in the Account History table for the open Endorsement Invoice. However, if the show_previous_credits_and_debits advanced setting is enabled, the renewal term will display a Previous Debit entry in the Account History table with the Summary description, Unpaid debit(s) from the previous term. The previous term’s Currently Due balance will include the Endorsement Invoice amount until paid. The renewal term balance won’t include the amount of the open Endorsement Invoice.

Exceptions to migrated debits

Outstanding debits will only appear on the Renewal Billing Invoice if the outstanding debit is transferred when the Renewal Billing Invoice is generated and the Debit Transfer entry appears on the Account History table. There are several scenarios that can cause a debit transfer to be placed after the renewal, such as when a payment is applied while the prior term is still in effect. If a payment is applied to the renewal term when the prior term is still in effect, then the debit transfer and its adjustment line are removed to allow the payment to be applied to the prior term. If a debit transfer falls after the Renewal Billing Invoice, then the debit transfer will appear on the following Installment Billing Invoice.

Below are workflows where the debit won’t carry forward:

  • When the last Installment Invoice’s Cancel Date falls after the renewal timeline setting.
  • When the renewal is manually created a year in advance (outstanding invoices on the current term).
  • When you make a payment in the past and the renewal term has already started, the previous debit transfers are soft-deleted. However, if there is an outstanding balance left on the prior term, then it will remain on the prior term because the term has already ended.
  • When a policy is rewritten, as it only has one term.

When the prior term is still in effect and a payment is applied, then the Debit Transfer and it’s associated Adjustment line are removed. The new Debit Transfer and Adjustment lines will be applied if there is still an outstanding debit in this scenario. The new Debit Transfer generated from making a payment will appear after the Renewal Billing Invoice and therefore will not show up on the Renewal Invoice (the Renewal Invoice has already been billed and mailed out).