Small businesses that have experienced property loss or damage rely on their insurance companies to give them the funds they need to get back on their feet.
These small companies rarely have surplus funds on hand to fix emergencies and thus depend on swift claim payouts to help them address their issues. Payouts made via paper checks leave a lot to be desired in terms of speed and clarity.
Consumers have also been calling for faster digital claims payouts, and the business policy holders who have access to more convenient payment methods in their personal lives are coming to expect similar options in the professional sphere.
Moving Away From Paper Checks
Insurers looking to meet these demands, reduce costs and improve efficiencies could consider moving claim payouts away from paper checks in favor of digital distribution methods, as reported in the “Digitizing B2B Payments Tracker,” a partnership between PYMNTS and Deluxe, one of the biggest check printers in the United States.
Get the report: Digitizing B2B Payments Tracker
Many businesses are making that transition. During Deluxe’s most recent quarterly earnings call, the company reported that more businesses and consumers are turning to quicker digital alternatives to pay the bills.
“Importantly, for the first time in our 106-year history, we expect payments to equal checks as our largest business by revenue as we exit 2022,” Deluxe President and CEO Barry McCarthy said during the Feb. 3 call.
Read more: Can’t Live With Paper Checks, Can’t Live Without ’Em
The decision to move away from paper checks must not be taken lightly, however, as paper checks have been a mainstay in the field, and many insurers’ existing workflows are designed with the payment method in mind. Moving away from physical checks could require identifying alternative payout methods that are easy for business clients to accept and offer similarly rich payments data.
Taking that into account, reducing or eliminating physical checks could bring notable benefits for insurers, such as helping them avoid expenses related to purchasing envelopes and mailing them out. Digital payments may also be easier for insurers to use and business customers to receive. This could see firms adopt eChecks or other detail-rich digital payment methods instead.
Addressing Business Customers’ Needs
As the demand for faster claim payouts heats up among individual insurance customers, this trend could sweep into the business sector as executives begin to expect similar conveniences in their professional lives.
This could suggest untapped demand for instant insurance disbursements, enabling the carriers that can meet these new needs to stand out among the competition. Policyholders that have experienced emergency situations want to receive their claim payouts quickly, and many clients are no longer willing to wait for checks in the mail.
Insurers must address their business customers’ needs or risk losing them to competitors. The firms that adopt digital payment methods may find that doing so not only creates smoother experiences for clients but also reduces their own costs.