Tag: reinsurance

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Economy EFG Companies Profit Participation Reinsurance

Have Confidence in Your Reinsurance Strategy

I love fall! As a native Midwesterner, I find that the crisp air and fall colors bring a sense of energy and enthusiasm for all things outdoors. But as a CPA and reinsurance expert, this time of year also brings another type of enthusiasm for some of us – it’s the time for strategic financial assessments and evaluations and aligning them with our short and long-term business goals.

For retail automotive dealer principals, fall means more time spent on number crunching (versus leaf crunching) to get a clearer picture of their actual personal wealth positions. Given the challenging business conditions this year, taking a closer look at those key positions is an important strategic move that could prove beneficial in the long run. Let’s look at a few factors that will impact overall wealth positions.

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Economy Industry Trends

The November Election and Your Reinsurance

We are just a few days away from the presidential election – as well as several state, county, and city races. As a dealer principal, you are likely watching the races for their impact on your strategic planning to ensure your financial positions are secure. While we do not have a crystal ball as to the outcome of the election, we do have some data points to assist with your strategic planning.

We all know that historically a typical Democratic policy reflects higher taxes on businesses, and a typical Republican policy touts lower taxes. While it is ineffective to apply this thinking across the board, the historical perspective can be useful in planning scenarios. Perhaps more importantly, there are some specific tax policies which could be in play depending on changes in congressional power.

Democratic Control and Taxes

If the Democratic candidate wins the presidential election and Democrats take a stronger position in Congress, there is a probability that corporate taxes will increase. More specifically, congressional Democrats may seek to remove the Bush-era qualified dividend tax break, affecting Controlled Foreign Corporation (CFC) and Non-Controlled Foreign Corporation (NCFC) reinsurance positions. To understand the implications of this, let’s consider the dividend breakdown. In terms of tax policy, there are two types of dividends: unqualified and qualified.

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Industry Trends

Your 2018 To Dos

Contributing Author: John Stephens Executive Vice President EFG Companies
Contributing Author:
John Stephens
Executive Vice President
EFG Companies

It’s that time of year again when everyone evaluates their yearly accomplishments, both personally and professionally, and begins making their 2018 resolutions. So, what were the automotive industry’s accomplishments?

Despite a string of severe natural disasters, unit sales volume is roughly on par with last year’s volume. Both 2017 and 2016 represent some of the strongest sales numbers in over a decade. That’s a win in my book.

The Consumer Financial Protection Bureau (CFPB) is beginning to be reined in by Congress. After years of lobbying for more oversight over the CFPB, dealer and auto lending initiatives are finally making headway on the Hill. Talk about another reason to celebrate!

Going into 2018, pre-owned inventories are finally right-sized for consumer demand. There’s no longer too much or too little inventory. We’re now at “just right”. Because of this, pre-owned vehicles are holding their value, and dealers have a better opportunity to increase profitability through CPO programs.

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