August 25, 2020
Payments at the Speed of Light
Insurers and solution providers are making significant advancements to speed delivery of payments and expand digital payment options.
While the processing of inbound and outbound payments in insurance isn’t exactly known for its speed, there are significant advancements being made by both insurers and solution providers to hasten delivery of payments and expand payment options.
A digital interaction actually happens at the speed of light – it is immediate and, being digitally based, can be controlled precisely. Insurers are now looking at sending invoices to their policyholders in the method of the policyholder’s choosing – email, SMS or even a digital wallet. The consumer can now start to change the method of payment in real time.
Consumers also want their money delivered at the speed of light, but outbound payments are still generally made by check.
Recently, SMA held an Insights to Solutions virtual event that focused on the transformation underway in the Digital Payments space. Of the insurers registered for the event, a resounding 83% stated that improved customer experience is a key motivator as they look to adopt digital payments. 67% of registrants envisioned digital payments as a key element of their digital strategy and road map.
Many of the changes needed to transform the outbound experience were also profiled at the event. The shift to digital payments requires an adaptation of people, processes and technology to make the experience successful for both the sender of the funds as well as the receiver.
At the event, we explored the impact of COVID-19 on payments. No one wants to send someone into the office just to print a check. 64% of the registrants were looking to reduce their reliance on paper checks, and 53% were seeking to reduce internal processing expenses.
The interest highlighted a focus on operational efficiency that includes offering the claimants options on an array of payment methods that are “best-fit” based on circumstances – the line of business, amount, etc.
See also: How Claims Process Must Drive Change
Even for those who pride themselves on being high-touch, an interaction with a person does not always best serve a customer. At times, the speed and efficiency of a digital process – including immediate payments – are better.
COVID-19 has accelerated many digital payments initiative, because advancements are needed now. There was always a need. Now there is also urgency.