Claims payouts are a crucial step in the customer journey, especially in this day and age, when customers are offered so much more choices in payment methods. The concept of instant gratification started in e-commerce and has now spread to insurance too. Instant gratification means that your customers are looking to get quick replies to their queries, and they want their problems solved as quickly and efficiently as possible – no long waits or complex processes.
In the case of disbursements, customers want to get paid soon after they make a claim (or even instantly). In fact, according to PYMNTS, only 20% of customers are willing to receive physical cheques as a claims payout method. This means that the other 80% are expecting digital solutions, which are far more efficient and faster.
Hosted disbursement solutions enable insurers to digitalise their payout systems without affecting their branding or their customer communications. Let’s explore what hosted disbursement solutions are and the kind of features you need to look for in these solutions so that you can make the best decisions for your business.
Disbursement is the process of disbursing or paying out funds from an account. Disbursements can apply to various situations, such as paying invoices or the delivery of a dividend payment to shareholders. In the context of insurance, disbursements have the same meaning as payouts – paying out to customers to cover their losses after a claim has been made.
Hosted disbursement solutions are payment solutions that enable insurers and enterprises in other sectors to deliver a better payout experience to their customers. In order to improve the payout experience, insurers need to offer digital payout methods to their customers alongside enhanced communication channels and an overall seamless and quick claims process.
Hosted disbursement solutions can be either payment providers, orchestrators, or payment middleware like Imburse. Payment providers enable you to offer multiple digital payout methods to your customers. You may be aware of providers like Stripe, GoCardless, Bottomline, or checkout.com, which are all popular in this market. However, no provider will have all the payout methods in the world available. This is likely a deal breaker for large insurers that operate in various markets across the globe and require a wide range of payment options to meet the needs of their customers.
Solutions like Imburse, as opposed to payment providers, offer connectivity to any provider or technology for both collections and payouts. This means that instead of having to connect with different providers to access different payout methods individually, you can simply integrate with Imburse, and we will connect you to your preferred providers much faster and cheaply. Imburse works as a marketplace that enables easy access to any provider or technology.
We have touched on some of the benefits that hosted disbursement solutions offer, so let’s look at some of them in more detail.
Reduced costs are a very valuable benefit, especially as constraints with traditional technology mean that insurers have to pay a much higher price to connect with modern solutions. Hosted disbursement solutions enable insurance companies to reduce costs in various ways. For instance, when choosing a solution like Imburse, you don’t have to build payment software in-house. You can also integrate seamlessly with Imburse via API.
The costs of building and maintaining in-house software can easily skyrocket, and they can also be unpredictable, as there are continuous software updates you will need to make. With such solutions, you don’t need to worry about software updates or adding new features – the third party will do it for you, so you can significantly save costs. To get an in-depth overview of whether to buy, build, or rent your insurance software, you can read our “Build, buy, or rent? The game-changing question for insurers” whitepaper.
It’s always more time-consuming to build something from scratch as opposed to integrating with something that is already fully built. That is the case with payment software, too – software systems take time to be built. They require a lot of internal resources, a lot of planning and pre-planning, researching, and testing.
This will slow time-to-market considerably, and it means that you won’t be able to adapt to changes in customer demand or business needs as quickly and swiftly as you would like to. Hosted disbursement solutions are already built and usually easy to integrate with, so you can speed up your time-to-market.
While some level of customer churn is normal, reducing customer churn is important to reduce costs. The insurance industry has the highest cost of customer acquisition of all industries, with an average cost of $900 per customer, so investing in ways to keep your customers loyal and engaged is crucial. Hosted disbursement solutions like Imburse enable you to provide an excellent, fully digitalized disbursement service to your customers, so you can continue to keep them happy and reduce customer churn.
Every solution is different, and the payments world can easily get complex, so choosing the best solution for your business may not be straightforward. Below are some of the key features that hosted disbursement solutions should have:
Make sure that the solution you choose has a good level of customisability, so you can use it to fit your unique needs as well as your company branding. For instance, Imburse offers a fully-customised hosted payment page. A hosted payment page is essentially a checkout page owned by a third party.
Your customers will be directed to this page when making a payment or receiving their claim payout. This page is fully secure and can be customised to reflect your branding. For instance, you can add your logo, your colours, and fonts to the page so it looks like it’s coming from you, and it anonymises the third party that’s hosting the page.
Being able to customise the solution to your own branding isn’t enough. You also need to make sure that the third party is open to accommodate new features to meet your needs. For instance, if you require more payment providers, the third party should be able to integrate you with them, even if they aren’t already pre-integrated.
Business needs change all the time. You may also be looking to expand to new markets or launch new products that require certain payment capabilities. It would be much more efficient for you to get all of these payment methods and features from a single solution rather than having to search the market every time you need a new feature or update. Some hosted disbursement solutions can do this for you.
Aside from the basic capabilities that all hosted disbursement solutions should have, looking for solutions that have extra capabilities can be advantageous. These capabilities should help you manage and monitor your payout systems better, making internal processes more efficient. Imburse offers a range of payment capabilities that are game-changing for managing your payout system effectively.
For instance, unified reporting enables you to gather all the payment reports from your providers into a single platform, enhancing visibility over your customers’ payments and your cash flow. Other capabilities, such as mandate management, enable you to efficiently manage, update and store your customers’ Direct Debit mandates all in one place.
Imburse enables you to instantly access BACS, SEPA, and BECS and easily create, register, amend and cancel mandates electronically. Our tool offers a single interface to manage entire mandate lifecycles, as well as unified reporting to improve visibility over your collections and payouts.
We also offer unique and innovative payment solutions that go beyond the variety of payment methods. Our Pay-by-Link solution makes for a much quicker and more efficient payout process and also works for collections.
This goes beyond the actual solution or platform you choose for your business. Regardless of the solution you choose and the capabilities it offers, it’s important to consider a solution that offers technical support at all times and a team that has the industry expertise to guide you in the right direction. Payments are not a core competency of insurers – so you may not have a dedicated team to manage this third-party solution and may require extra guidance.
Instead of having to look for industry experts that can manage and monitor this solution for you, you can choose a third party that offers such support. For instance, a third party that offers you an Account Manager to answer your queries and concerns.
Imburse is a cloud-based middleware connecting large enterprises to the global payments ecosystem, regardless of their existing IT infrastructure. Through a single connection to Imburse, enterprises can collect or pay out using any 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 capabilities. 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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