Sending Insurance Claim Payments Faster and Easier With Digital Disbursements

Customers often experience the frustration of waiting days, weeks, or even months before receiving a payment from their insurer after submitting a claim. This translates into lower customer satisfaction and loyalty, which impacts revenue and competitiveness.

Customer retention is cheaper than customer acquisition. According to an Invesp report, acquiring a new customer is five times more expensive than maintaining an existing customer. Despite the higher costs for customer acquisition, 44% of companies admit focusing their efforts on acquiring new customers and leaving customer retention efforts for the second plan.

The importance of efficient claims processes 

A business’s financial health can be measured by its ability to provide good customer service. Claims processing is one essential function of insurance that can highly impact the insurer’s success. A claims management process is crucial for protecting the interests of various stakeholders, including the policyholders. Effective claims management processes are essential for building profitable businesses and customer trust by setting high service standards.

Insurance customers expect a company to settle claims quickly and seamlessly. Reducing the time it takes for policyholders to get paid is a way for insurers to get a competitive edge, decrease the number of customer complaints and boost customer loyalty. According to an Insurance and Mobility Solutions report, 40% of drivers that submit a claim on their auto insurance are likely to switch providers after making a claim.

So how can insurers make sure that their customers are satisfied and increase retention? That’s where digital disbursements come in.

What are digital disbursements? 

Digital disbursements are any payment method that is processed digitally, including bank transfers, debit and credit cards, alternative payment methods, digital wallets, and vouchers. Some payment methods, such as bank transfers, have been around for a long time, while others are relatively new. Digital wallets, for instance, were first introduced with Google Wallet in 2011. By 2015, a range of digital wallets was available, including Apply Pay and Samsung Pay. The payments ecosystem offers a long list of innovative payment methods that is continuously growing. Let’s dive into some of the digital disbursement options available in the market.

Types of digital disbursements

Digital wallets

Digital wallets or e-wallets allow insurers to send money directly to their customers’ mobile phones without using a bank account. They also offer additional features such as two-factor authentication, fraud protection, and transaction history. The most popular digital wallet services include Apple Pay, Google Wallet, Samsung Pay, PayPal, Venmo, and Square Cash.

Apple Pay is available for all iOS users, for instance, whereas Samsung users can access Samsung Pay, and other Android users can access Google Pay. Apple Pay lets you pay in over 60 countries, and Samsung Pay lets you pay in at least 24 countries.

They can be a great digital disbursement type if your customers are traveling and need the funds urgently on their phones. Suppose your customer has lost their luggage and wallet with all the credit and debit cards in it but still has their phone. A digital wallet would likely be their preferred payout option.


If you’ve ever bought anything online, you have probably heard of PayPal. It’s one of the most popular forms of digital disbursements because it allows users to pay for things without sharing their credit card numbers. You simply enter your billing address and select the amount you want to spend. Once you confirm the purchase, PayPal sends the funds directly to your bank account. It’s also equally as easy to get paid via PayPal, as all the payer needs is an email address. Funds are transferred instantly.

Bank transfer

You can send funds directly to another person’s bank account with a bank transfer. It’s easy to set up and requires no paperwork. You simply need to know the recipient’s bank details. Bank transfers are usually free, but there may be fees depending on the amount being transferred. They also take longer than other payment methods. Depending on the payment system that you use, bank transfers may take up to 3 days to be processed. Each country has its national payment system. For instance, the UK has BACS, whereas the US has ACH.


Push-to-card enables insurers (the payer) to actively “push” funds into another card. This payment method is instant and convenient, as customers can use their funds immediately. Besides, most debit and credit cards are now contactless, so they use Near-Field Communication technology that lets cardholders tap their cards on machine readers to pay for purchases without typing in their PIN number. This makes it even easier for customers to receive and use the funds. Insurers need the customers’ card details to make a push-to-card payment, and they must ensure that these are kept up-to-date.


voucher is a pre-paid gift card that can be redeemed for goods and services. Vouchers can be sent via email or text message, and they’re ideal for sending small amounts of cash to someone who has requested it. They are also an excellent option for policyholders claiming a small payout and may be more convenient than other payment methods, as vouchers can be used immediately.

Electronic checks

An electronic check is similar to a paper check in that it’s made payable to a specific individual. However, unlike a paper check, an electronic check doesn’t have to be physically mailed. Instead, it’s transmitted electronically to the recipient’s bank account.

How do digital disbursements work?

How digital disbursements work varies depending on the payment method. Bank transfers are processed via clearing houses or payment systems and aren’t instant. Push-to-card payments are more straightforward, as payments are processed in real time, and the payer only needs the payee’s card details to initiate the payment. Customers can receive the funds instantly. Depending on the situation that your customer is in, real-time payouts may make all the difference and turn a stressed customer into a satisfied one.

To offer all of these payment methods, insurers need payment providers or PSPs. These payment providers are responsible for processing the payment and communicating with the payer and payee. Many payment processing companies are available, each offering different payment methods for other markets.

Some of the most popular payment processing companies (or payment providers) worldwide include Stripe, Braintree, GoCardless, Bottomline, and Adyen. As we mentioned, these offer different payment methods and may be specific to a single method. For instance, GoCardless focuses solely on one-off or recurring Direct Debit payments. Adyen covers 18 payment methods, including debit and credit card networks and mobile wallets.

Insurers that operate in multiple markets need more than one provider to fit their payment needs. This is because no payment provider offers access to all the payment methods available in all countries. Some payment methods are country or region-specific, so they may not be so widely known. Yet, offering country-specific methods is essential to fit your customers’ needs.

How to send insurance claim payments faster and easier

There is a wide variety of payment solutions and providers available. So much so that it becomes challenging to navigate the complexity of this ecosystem. Particularly for insurers but also for most sectors that don’t have sufficient payment expertise, a dedicated payments team, or enough resources and time to invest in building one.

Most often than not, building an in-house payments team is also not feasible, as insurers have other core areas to focus on, and their resources need to be allocated to other more pressing business areas.

Insurers can connect with various payment providers to meet their customers’ payment preferences. However, these connections are complex, lengthy, and costly. This makes it difficult for insurers to promptly deliver on customer expectations and digitalise their payment systems so they can keep ahead of the market. The insurance industry is rapidly changing, so months-long integrations will slow insurers down.

The best way for insurers to fully digitalise their payment processes and offer a wide selection of digital payment methods to their customers is by using a payment middleware like Imburse. No more multiple integrations are required, as a single integration to Imburse gives you access to any provider or technology in any market. Imburse also offers both collections and payouts, so you can pay out to your customers in any method your customers prefer.

Solutions like Imburse also offer the payment expertise you need to guide you through this ecosystem and ensure you make the right decisions to digitalise your payments system. This way, you won’t need an in-house payments team, and you won’t need to waste your own resources.

About Imburse

Imburse is a cloud-based middleware connecting large enterprises to the payments ecosystem, regardless of their existing IT infrastructure. Through a single connection to Imburse, enterprises can collect or pay out using various payment technologies and providers around the globe.

In a world where consumers’ payment preferences and technologies are ever-evolving, Imburse works with insurers to future-proof their payment requirements. Regardless of the business area, market, or requirements, Imburse will connect you to your choice of technology and provider.

Reach out to our team should you want to discuss how Imburse can help you. Our team is happy to show you what our platform can do for your business and offer you a free demo.

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