Why Industry Expertise Matters in Insurance Premium Collection
In the wide world of payment services, one of the most specialized areas to operate in is insurance. Any company facilitating transactions in this space has to know their own business, of course, but they also need to know the business of insurance, too – and as we know, that’s no simple matter.
Small details, big implications
Let’s look at a few examples of how the small details behind a transaction can bear big consequences for the insurer.
- Down to the minute. While insurance coverages are sometimes described as products, what’s sold is really an agreement – and that matters, because the moment that this agreement is made between parties can bear major financial implications. If a loss occurs before the precise minute that an agreement becomes binding, the insurer is not responsible for the claim. If after, it certainly is. Does your payment system make binding transparent?
- Policy cancelled, or still good? The moment that payment is received can also come with ramifications. Let’s say a policyholder is late on payment, and as a result, the policy is up for cancellation. If payment comes through and the insurer accepts it, the policy is considered to be in effect after all, because payment was accepted, even if the transaction took place after the cancellation date. A loss occurring in the gap is still the insurer’s responsibility. Does your payment system give you control over when, and whether, to accept policyholder payments?
- Conflicting rules. In many places, insurers are not allowed to charge convenience fees for digital payments; however, their payment partners can, so they may collect those fees from the policyholder before passing the premium to the insurer. But sometimes insurance rules require the entire amount collected from the policyholder to be deposited in the insurer’s bank account first. Does your payment system empower you to implement policy that can reconcile conflicting rules like these?
All this is to say, the details of how your payment system is configured – and its ability to let you do so – are pretty important. If you have a system that’s too simplistic to facilitate the granular business rules you need to conduct an efficient and profitable operation, the results will cost you. If your payment partner requires you to hand over all your data before they can reconcile your invoices, you’ve got a behemoth on your hands.
What you need, rather, is a payment partner with a highly configurable service set and real-time validation, delivered through an integrated system that can iron out the wrinkles between many moving pieces. Of course, the IT also needs to be secure.
This is precisely what we deliver at Silvervine. We understand payment processing; we understand insurance. Which is why we’re specifically equipped to meet your transactional needs: take a look.