Saturday, March 2, 2024

How Insurance Companies Are Transforming Claim Processing with Checkbook

Insurance Companies
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The Problem

It’s 2023. We can place video calls to the Sahara Desert. Chabots now want to be alive. Drones have started delivering packages. And yet, many insurance carriers still depend on paper checks for claim payments. It’s an embarrassingly outdated system: paper checks take far too long to process, then claimants have to wait to receive them through the mail, which can be affected by distance, mishaps, delivery issues, and myriad other delays. While the check is taking its time to clear the traditional disbursement system, the Smith family, who just had their roof blown off by a category 5 tornado, is in limbo: they don’t know when they’ll get their money because their mailbox is gone, so they have no way of receiving the paper check that’s “in transit.”

The Solution

Checkbook overrides the archaic paper check method altogether. What used to take weeks through a traditional payment system can now be pushed to pay instantly. Once the claim is processed, Checkbook’s platform processes the payments in real time, so claimants can receive and use the money immediately. That means:

Reduced Customer Wait Times 

When a claim is approved, recipients want their money “yesterday.” Waiting for promised funds when the turnaround time is unpredictable can be excruciating, especially when the money needs to be used for something as pressing as a new roof. Checkbook’s easy access and rapid turnaround time for funds gives customers more control over how they access their money.

Alternative Solutions

According to an Accenture article, “Dissatisfaction around the claims experience is a key reason driving customers to switch insurers.”  Checkbook’s flexible options put money into the hands of your customers quickly and efficiently. 

Choice Matters

Checkbook offers a wide variety of disbursement options to meet the unique needs of customers, including mailed paper checks when requested. The options include:

  • Direct deposit – Money transfers directly into the recipient’s bank account using a routing and account number that can be conveniently inputted through an API like Plaid. This eliminates the need for the insurance company to have this information, protecting customer privacy.
  • Printable checks – Recipients receive a check that they can print at home and then deposit using the banking app on their phone. And while the industry standard for sending a paper check is $7, Checkbook’s is less than $1, saving substantial money when making many payouts. With Checkbook, insurers can also send payments to multiple recipients, such as multiple owners of a home that was damaged, as well as a bank or another lender.
  • Real-time payments – Recipients receive funds in real time through existing banking rails using the same information required for a direct deposit.
  • Instant Pay – Recipients can transfer money into their bank accounts in seconds by simply entering their debit card details. 
  • Virtual credit cards – These unique 16-digit card numbers are generated on demand and can be used instantly to make payments. The card works just like a regular credit card at online stores or can be added to a mobile wallet for use on the go. 

“Checkbook has created an easier process for disbursing claims where insurers become heroes to their customers. Policyholders receive an email with a choice of payment options. Once they choose how they want to receive their money, it’s delivered to them instantly. They never need to share sensitive information. This makes the disbursement process faster and safer for customers. It helps to get their life back on track fast after a disaster.” 

– P.J. Gupta, Founder & CEO, Checkbook

The outlook for instant payments is promising:

  • In 2021, the global real-time payments market size was valued at USD 13.55 billion, with an expected compound annual growth rate of 34.9% from 2022 to 2030.
  • In a Visa survey, 82% of consumers said they’d prefer to work with a business that offered push-to-card options.
  • Instant payment systems offer faster, more efficient and inclusive payment options that generally maintain the current framework of payment systems and money.
  • Most countries are transitioning to instant payment technology to improve payment infrastructure by ensuring transactions happen in seconds and without interruption.

Consumers want efficiency in their payment transactions, including insurance claims. Industries that step outside of traditional payment models and embrace instant payments to meet the needs of their customers will find themselves positioned ahead of competition that still relies on antiquated disbursement models.

Checkbook works with insurance companies of all sizes to streamline their claim disbursement process and provide their customers with a fast, efficient method for receiving funds on their terms. 

Paper checks are just as useful to an updated business as fax machines—it’s time for payments to get modern. Learn more about how Checkbook is helping insurance companies meet the needs of today’s customers.

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