Dealer Reinsuranceby Elite FI Partners
Pro forma

Dealer Reinsurance Pro Forma

Model how dealership volume, product penetration, program costs, expected claims, and reserve development may affect a reinsurance program over time. Enter your own numbers, or start from the editable example, and every result updates immediately.

Educational illustration

This is an educational projection based on user-entered assumptions. It is not a proposal, guarantee, accounting statement, tax analysis, or prediction of actual performance. Nothing is submitted or saved unless you choose to request a review.

Annual gross remitted $907,800. Annual remaining reserve contribution $178,110. Modeled 5-year ending reserve value $890,550.

Starting values are an editable illustration, not industry averages or expected results.

1 · Dealership volume
Annual = 1,200 units (calculated).
Share of deals that can carry a product. 0–100%.
1–10 years.
2 · Product mix & economics

Enable the products your program includes. Not every program contains every product.

Vehicle service contract
GAP
Tire and wheel
Appearance protection
Key replacement
Maintenance
Other product
3 · Program costs & assumptions
Applied in year 1 only.
Legal, accounting, tax, admin of the structure.
Your assumption only. Defaults to 0.
Funds leaving the structure. Defaults to 0.

Any tax-related modeling is a user-supplied assumption and is not tax advice. Confirm treatment with qualified professionals.

Projected results

Annual eligible contracts
1,020
Annual gross remitted amount
$907,800
Annual program fees
$205,308
Admin + ceding + mgmt + professional
Annual expected claims
$450,330
Annual remaining reserve contribution
$178,110
5-year projected reserve value
$890,550
Cumulative projected underwriting result
$890,550

Annual money-flow

Where one year of the $907,800 gross remitted amount goes before anything reaches the reserve.

Administration $144,840Ceding fees $36,312Management $18,156Expected claims + cancellations $524,382Professional expenses $6,000Remaining reserve contribution $178,110

Projected contribution by product

Vehicle service contract$106,488
GAP$54,978
Tire and wheel$22,644

Multi-year modeled reserve value

Y1Y2Y3Y4Y5$890,550

Year-by-year projection

YearEligible contractsGross remittedFees & expensesExpected claimsRemaining contributionInvestment activityDistributionEnding modeled balance
Year 11,020$907,800$205,308$524,382$178,110——$178,110
Year 21,020$907,800$205,308$524,382$178,110——$356,220
Year 31,020$907,800$205,308$524,382$178,110——$534,330
Year 41,020$907,800$205,308$524,382$178,110——$712,440
Year 51,020$907,800$205,308$524,382$178,110——$890,550

Sensitivity

How the 5-year ending modeled reserve value shifts with claims and volume. The higher case is not the expected case.

Claims (loss ratio)
Lower (−30%)$1,566,045
Current assumption$890,550
Higher (+30%)$215,055
Volume
Lower (−30%)$614,385
Current assumption$890,550
Higher (+30%)$1,166,715
How this result was calculated

Annual contracts = annual retail units × eligible % × product penetration.

Gross remitted = contracts × remitted amount per contract.

Fees: administration = contracts × admin $; ceding = gross × ceding %; management = gross × management %.

Expected claims = gross × loss ratio %. Cancellations = gross × cancellation %.

Remaining reserve contribution = gross − fees − professional expenses − expected claims − cancellations (minus setup cost in year 1). This may be negative.

Investment activity = prior-year ending reserve × investment return %. Distribution = distribution % × the positive available balance, only when you enter a distribution assumption.

Ending modeled balance = prior reserve + remaining contribution + investment activity − distribution. Production is held constant across years in this tool.

Remaining reserve contribution is not profit and is not immediately distributable cash. Actual earning methods, reserve requirements, and accounting vary by provider, product, and structure.

Assumptions used
Monthly retail units
100
Annual retail units
1,200
Eligible transactions
85%
Projection period
5 years
Vehicle service contract — penetration / remittance
45% / $1,200
Vehicle service contract — admin / ceding / mgmt / loss / cancel
$200 / 4% / 2% / 50% / 8%
GAP — penetration / remittance
35% / $600
GAP — admin / ceding / mgmt / loss / cancel
$80 / 4% / 2% / 45% / 10%
Tire and wheel — penetration / remittance
20% / $700
Tire and wheel — admin / ceding / mgmt / loss / cancel
$120 / 4% / 2% / 55% / 6%
Setup cost (year 1)
$0
Annual professional expenses
$6,000
Investment return assumption
0%
Distribution assumption
0% of available

Everything runs in your browser. Nothing is submitted or saved unless you choose to request a review.

Why these numbers matter

Premium generated — production drives the opportunity
Everything starts with how much protected business the dealership writes. More eligible units and higher product penetration mean more remittance flowing into the structure. Production is the single biggest lever: a program cannot out-earn a thin book of business, no matter how favorable its terms.
Claims — lower claims improve underwriting performance
Claims are paid out of the same money that would otherwise build the reserve. A lower loss ratio leaves more underwriting margin to retain, invest, and eventually distribute; a higher loss ratio erodes it. Because claims compound over a multi-year projection, even a few points of loss-ratio difference can dominate the result.
Reserves — money retained for future obligations
A reserve is money set aside to pay future claims. It is not free cash and not profit — it backs obligations and is subject to reserve and collateral requirements. Reserves can grow through underwriting contributions and investment earnings, but what can actually be accessed depends on the program’s rules.
Investment income — the impact of retained capital
Reserves that are invested can earn a return, and because that return compounds on a growing balance, small differences in the assumed rate add up over time. Investment income only applies to the investable portion of reserves, net of any investment management fee, and never to funds restricted as collateral or minimum cash.
Fees — admin, ceding, trust, management, and professional costs
Fees come in several shapes: per-contract administration, percentage-based ceding and management fees, fixed trust and professional costs (accounting, legal, tax, actuarial), and investment management fees. Each reduces the underwriting contribution that builds the reserve. Breaking them out — rather than lumping them into one number — is the only way to see what actually drives a difference.
Distributions — available cash versus long-term value
A distribution moves value from the reserve to the dealer as cash. It changes when and where value sits, but taking a distribution does not by itself create additional economic value. Total value counts both the ending reserve and cumulative distributions, so faster cash is a liquidity choice, not a bigger pie.

Keep learning

FAQ

About this pro forma.

What is a dealer reinsurance pro forma?

A pro forma is an educational projection that models how a reinsurance program might perform on a set of assumptions you enter: dealership volume, product penetration and pricing, program fees, expected claims, cancellations, reserves, and an optional investment or distribution assumption. It illustrates how the money may move over time. It is not a proposal, a guarantee, a tax analysis, or a prediction of actual results.

Does this pro forma predict my actual results?

No. It shows a modeled outcome based only on the numbers you enter. Actual results depend on real product remittance, claims development, cancellations, fees, reserve requirements, program agreements, and professional guidance. Change any assumption and the projection changes. Treat the starting values as an editable example, not an expectation.

What does “remaining reserve contribution” mean here?

It is the amount left after the illustrated fees, expenses, expected claims, and cancellations are subtracted from the gross remitted amount. It is what may flow into the reserve you participate in. It is not profit, and it is not immediately distributable cash. What can actually be accessed depends on reserve requirements and program rules.

How do I model an investment return or a distribution?

Both default to zero, on purpose. Enter an investment return only as your own assumption about how reserves might grow, and a distribution percentage only if you want to model funds leaving the structure. The tool never assumes an aggressive return, and it shows a distribution amount only when you enter one.

When you are ready

Want a detailed review of the assumptions behind this pro forma?

This tool provides a preliminary educational illustration. A complete review should use actual product remittance, program agreements, statements, claims experience, fees, reserve requirements, and professional guidance. Elite FI Partners can help.