New Trends in Online Payment Processing
Have you ever mapped out the customer journey for your auto and home policyholders? If you did, you’d discover this interesting truth: Most policyholder interactions involve payments. Either they’re paying you premiums or you’re paying them for claims.
Because your most frequent policyholder touchpoint involves payments, it’s vital to have a cutting edge payment processing system. When you take or make a payment, the experience better be good, because you might not get a second chance to make it right.
Here’s a look at the new trends in online payments . . .
Trend #1: Digital Payments Have Surpassed Checks
For the first time ever, the number of digital debit transfers exceeded the number of check payments in 2018. According to the 2019 Federal Reserve Payments Study, there were 12.6 billion digital (ACH) debit transfers in 2018, up from 2.1 billion in 2000. The number of check payments dropped from 42.6 billion in 2000 to 14.5 billion in 2018.
Some people still use checks, at least some of the time, but there’s a reason many people associate check use with senior citizens. Checks are not nearly as common as they used to be. Some people don’t even own checks, and many people consider writing them to be a hassle. Checks are still in use, for now, but they’re on their way out as a well-liked option– and people expect other payment options.
Trend #2: Consumers Demand Easy and Fast Options
Digital payments are popular because they’re easy and fast.
Modern consumers don’t want to have to jump through hoops to make a payment. They want to be able to hit a couple of buttons and be done with it. Insurance companies can meet these expectations by creating an easy-to-use payment option, ideally as part of an insurance app. According to the TSYS U.S. Consumer Payment Study, in-app payments are especially popular with younger consumers, and 82% of people between the ages of 18 and 22 are familiar with this option.
But the easiest payment process is the one that doesn’t require any action. Allowing policyholders to setup automatic payments that recur monthly means that policyholder have one less thing to worry about. It can also help prevent late or missed payments, creating a win-win situation for both the insurance company and the insurance customer.
Trend #3: Security Is Essential
Consumers are worried about their data, and they have every reason to be. Cybercrime has exploded. According to ZDNet, ransomware attacks increased by 715% in 2020.
Online payment processing can’t just be convenient. It also has to be secure. As cybercriminals develop more targeted and sophisticated attacks, companies must work increasingly hard to ensure that consumer data is safe.
Trend #4: It Goes Both Ways
Policyholders want to make payments using a method that’s fast and convenient. They also want to receive payments using a method that’s fast and convenient. When insurance customers are expecting a claim payment, they don’t want to wait days or even weeks for a paper check. They want their payout now. To meet this need, digital claims payouts are no longer optional.
Is It Time for an Upgrade?
If your incoming or outgoing payment processing could use a boost, Silvervine can help. We have the most competitive pricing in the industry. And insurers can add significant revenue with digital payment options. Learn more here.