Beyond CPI: The New Era of Intelligent Asset Risk Management
Credit unions are shifting from traditional, paper-driven CPI programs to integrated, data-powered asset risk management. With rising delinquencies, market volatility, and evolving regulations, lenders need automated insurance verification, recovery analytics, and transparent partner models to protect portfolios and member relationships.
Originally posted on CUToday.info
Credit unions are facing a new era in asset risk management—one where old assumptions about collateral protection insurance (CPI) no longer fit. Once viewed narrowly as a standalone compliance product, CPI has evolved into one component of a far broader, technology-driven ecosystem aimed at safeguarding portfolios, reducing charge-offs, and protecting member relationships amid volatile market conditions, Allied Solutions said.
“It’s no longer just CPI,” said Pete Hilger, CEO of Allied Solutions. “CPI is just a component of prudent risk management—reducing charge-offs, protecting portfolio performance, and protecting the ultimate amount you have to recover from a member. There are so many more tools available now.”
Hilger said the credit union environment has shifted dramatically over the past decade as rising interest rates, lingering pandemic-era loans, and used-car value swings have upended portfolio performance metrics. That turbulence has forced lenders to rethink how they protect collateral.
“Traditionally, CPI was about tracking a portfolio, sending notices, and force-placing coverage when members didn’t provide insurance,” Hilger explained. “It was paper-heavy and reactive. Today it’s part of a much more dynamic and data-rich asset risk management process.”
That evolution includes sophisticated automation and analytics that reduce disruption to members while improving accuracy. Allied, for example, invests heavily in systems that retrieve insurance data directly from source networks—even if a lienholder isn’t listed—allowing lenders to verify coverage faster and avoid unnecessary force placement. License plate recognition tools and geolocation analytics are also being used to help credit unions identify and recover at-risk assets earlier in the delinquency cycle.
Technology, Transparency, And Trust
Hilger emphasized that the real differentiator among providers today is not who can force-place insurance faster, but who can help credit unions minimize member friction and protect their brand.
“You don’t want this tool to create a problem,” he said. “The member relationship is everything. This product isn’t chosen by the member—it’s a consequence product. That’s why credit unions have to pick their partners wisely and make sure they’re delivering the best possible member experience.”
Hilger noted that while some vendors still entice institutions with high commission structures or “quick money” incentives, regulators in states such as Minnesota and New York have already made clear that CPI should not function as a revenue generator.
“It’s a risk management tool,” he said. “History will repeat itself—compensation arrangements tied to CPI premiums are going away. Credit unions shouldn’t put their brand at risk chasing that. Credit unions would be better off expanding coverages that reduce deficits and lower charge-offs to create the value in the program versus being paid compensation on a force placed program.”
New Pressures, New Expectations
Economic conditions have made risk management more complex. Credit unions are contending with higher delinquency rates, a tight insurance market, and lingering pandemic-era portfolios. At the same time, smaller repo and skip-tracing firms have disappeared, creating pressure on lenders to leverage national-scale partners with the technology and volume to manage recoveries efficiently.
“The first thing I tell credit unions is to assess their risk appetite,” Hilger said. “Then look internally—do you have the talent, tools, and technology to manage that risk in-house? Can you leverage pricing and volume to your advantage? If not, you need a partner that can.”
He pointed to Allied’s own Asset Recovery Management platform as an example of the integration trend, combining CPI tracking with data-driven recovery support.
“An event like a delinquency, accident, or repossession is where asset risk management really comes in,” Hilger said. “It’s about taking you from the moment of delinquency all the way to disposition.”
Looking Ahead: From Cost Center To Growth Enabler
Hilger believes credit unions should see risk management programs not as operational costs but as strategic enablers of growth and resilience. With automation, data analytics, and flexible multi-carrier solutions, credit unions can protect portfolios, reduce losses, and improve member outcomes simultaneously.
“This industry is modernizing fast,” Hilger said. “The best programs are those built on transparency, integrity, and technology—programs that benefit both the institution and its members.
“Pick your partners wisely,” concluded Hilger. “Make sure they can deliver the best member experience for a product that’s not chosen by the member. Look for infrastructure, stability, and full transparency. That’s what will separate the strong credit unions from the ones still playing defense.”