Transform Your Claims Experience with Instant Payments
Did you know that 80% of your Millennial and Gen Z policyholders would be willing to switch to a different insurance provider to receive instant claim payments? Learn more about these (and other) shifting claim payment expectations.
If costs and technology limitations were no object, what kind of claims experience would you create for your policyholders? For nearly every insurer, the answer includes words like fast, automated, personalized, convenient, and mobile—where policyholders can use a simple app to submit a claim, review an estimate, choose a service provider, and receive their payment, all within a matter of hours.
In many respects, the industry is not that far from achieving these ideals. Most insurers already provide a convenient app-driven experience for submitting, assessing, and approving claims. But claim payments is the one big area where reality still falls short. According to a recent Engine Insights survey commissioned by VPay, nearly 60% of consumers who filed an insurance claim in the past three years received their last claim payment by paper check. For more than half of those consumers, that payment took four days or longer to receive.
And it’s not as if today’s policyholders are indifferent about their payment experiences. In the same survey, more than 80% of respondents said that the ease, speed, and convenience of their claim payments directly impacts their level of satisfaction with their insurer. And 53% of all respondents—including more than 80% of younger Millennial and Gen Z policyholders—said they would be willing to switch providers to receive instant claim payments.
So if payments are the slowest, most outdated piece of the claims process (they usually are)—and if faster payments really matter to your policyholders (they definitely do), how do you move more quickly toward the kinds of instant payment experiences your policyholders are looking for? There are obviously no easy, one-size-fits-all answers, but here are three practices that have consistently helped insurers accelerate their journey toward faster claim payments.
1. Expand your digital payment portfolio beyond ACH
Automated clearing house (ACH) payments are by far the most common digital claim payment option insurers offer today. But at 2-3 days, ACH payments are not much faster than checks, and they require payees to supply their bank account information (which many policyholders reluctant to do for one-time claim payments). As a result, smart insurers are actively working to add push-to-debit, virtual cards (for service providers), and other newer and faster digital options to their payment portfolios. In the short term, these additional digital options are safe and relatively easy to set up, and they can quickly reduce your claim payment window from days to hours.
2. Make it easy and safe for policyholders to choose their preferred payment option
Payments need to be as convenient and personalized as the rest of your claims process. In practical terms, this means giving service providers and policyholders an easy, convenient way to choose their preferred payment method as part of a larger app-driven claim experience. This type of claim payment personalization will naturally fuel the migration away from slow, expensive paper checks, accelerate the adoption of faster digital payments, and provide a natural foundation for more real-time claim payment options down the road.
3. Develop a plan to embrace emerging payment technologies
Leveraging peer-to-peer payment networks like Venmo and Zelle may not be a viable option for most insurers right now. But these tools are quickly gaining traction (especially among younger policyholders) and they make it possible to deliver true real-time payment experiences. By preparing to leverage these new payment platforms for claim payments when the time is right, you put yourself in the best possible position to expand your payment options and make instant claim payments a reality for your policyholders.
Explore the impact and potential of instant claim payments in more detail
VPay is ready to help you improve your claim payment experiences today—and move confidently toward true instant payment options when it makes sense for your organization.
Read this white paper and infographic to explore the results of the Engine Insights survey, learn more about your policyholders’ claim payment preferences and expectations, and gain new insights into how you can modernize and accelerate your claim payment experiences.