As P/C carriers continue their focus on digital transformation, Claims organizations are expanding their capabilities to reduce friction in the claims life cycle in an area where it matters most, getting paid. Travelers recently announced adding Paypal to its suite of payment options for claimants in auto, property and general liability with planned expansion to WC for injured workers. Travelers is leveraging the digital disbursement platform from Bank of America Merrill Lynch to provide easy payment processing via a simple sign on process. Allstate launched a similar program, also on the Bank of America Merrill Lynch platform.
The ease of receiving claim payments after a loss is a key differentiator for carriers in the highly competitive P/C market. Recent studies by JD Power for auto and property claim satisfaction indicates that communication, transparency and digital interaction are important components for customers in rating claim services. Digital claim disbursements are a key capability in improving all three components.
Financial Benefits
In addition to improving customer experience and engagement, digital claim disbursements also provide a financial benefit to carriers. Paper checks can cost from $6 – $9 a transaction compared to digital transaction fees estimated at $1 – $2. Digital disbursements have the added benefit of potentially shortening claim cycle times and improving negotiation leverage for carriers.
The Digital Future
Support for PayPal is indicative of a shifting financial expectation for consumers. Traditional credit card services continue to be challenged through direct money transfer services including Zelle, Venmo, Applepay, Googlepay as well as Paypal. The simplicity and immediacy of the digital interaction is setting the standard for payment expectations. Sending a paper check for a claim payout is as unusual to many consumers as waiting for a letter in the mail vs. texting or using social media.
Our recent research on Digital Claims Payments provides a full view of business drivers as well as challenges to consider in addition to an overview of some of the prominent solution providers. Please reach out to me at [email protected] to continue the conversation.
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