Why should insurance companies utilise carrier billing?

The insurance industry is huge. Today, insurance is a necessity for many things. From homes, cars, businesses and mobiles, to life and travel insurance, consumers want to know that what means most to them is protected.

However, the sector, worth billions, has been slow to change. Digitalization has reached the insurance industry later than many other sectors. Mitch Doust, executive vice president at insurance company Cover Genius, states that “With the amount of innovation going on in the payments space at the moment, the insurance industry is lagging significantly behind other industries when it comes to speed of payments.”

Time for a digital transformation

Some insurance claims can take weeks, or even months to pay out, according to a recent case study by Forbes. This doesn’t match up with consumer’s growing needs.

“We live in a world where consumers are used to receiving fast service,” says Daniel Durazo, a spokesman for Allianz. “E-commerce companies have conditioned consumers to expect fast service with little effort and minimum communication.”

Just like the digital landscape, insurance is changing. By moving away from time-consuming, repetitive, paper-based processes, the consistent automation of manual processes and the use of new technologies could increase premium income by almost 25 percent and simultaneously reduce costs by almost 30 percent. According to experts, the greatest savings are possible in claims settlement and acquisition costs.

Rather than previously outdated annual transactional payments, insurance is now more readily available, as well as being multi-purpose, to be accessed when and where consumers need it. The payment process should also reflect this.

Insurance on the go should be simple, secure and convenient; sorting out travel insurance for your next holiday when you are sitting in the lounge at the airport or adding another driver to your car insurance over the holiday period when family and friends come to visit.  This is where carrier billing steps in.

Insurance and carrier billing case studies

Carrier billing is especially convenient for insurance companies operating in developing countries. For example, if a health insurance policy is sent out via post, it may not often be received, filled out by the recipient or returned. Also, the customer may have a low income and not own or have access to a bank account. This issue is easily solved by carrier billing.

By offering micro insurance for the likes of health or life insurance, these companies give protection to individuals and families on low incomes in exchange for small regular daily payments.  The insurance company can simply send the policy to the customer’s phone with an opt in. Once opted in to the policy, the insurance company deducts the insurance policy cost from their phone bill. Simple, easy and convenient.

The future of insurance payments

The landscape for insurance is evidently changing. With digital transformations driving customer engagement, now is the time to put customers at the forefront, listen to their needs, make internal processes more efficient and effectively adapt to a digital world.

Contact SLA Digital today to discuss adding carrier billing as a payment method for your insurance products and services.