In the auto claims industry, the payments tech stack is complex, and the total cost of ownership is expensive.
As Michael Boeke, vice president of payments product management at CCC Intelligent Solutions, told PYMNTS in an interview, “payments can look pretty different depending on where a carrier is in terms of their digital journey.”
Carriers that are just beginning their digital journeys are still sending huge volumes of paper checks, he explained, compared to those that are further along in their digital transformation.
“The carriers that are sending out a lot of paper checks are still relying on legacy vendors, banks and payments providers, and they’re likely incurring some hidden costs caused by their systems not being well connected to the rest of their claims lifecycle,” Boeke said.
For the less digitally advanced carriers, the challenge lies in streamlining the actual flow of funds (and claims) on the back end across several stakeholders’ integrated technologies to create more connected touch points. The complexity of it all gives rise to friction and pain points that can be grouped into three buckets.
First and perhaps foremost, the policyholder experience suffers, said Boeke, adding that “we’re living in a world now where we’re all used to being able to settle up electronically with apps on our phones when it comes to just about everything in our everyday life.”
Increasingly, consumers are demanding the same seamlessness when it comes to insurance.
Then there’s the desire for a smoother experience that extends to the carriers’ trading partners, including the repair facilities and lenders.
“With so much paper in the mix, these stakeholders have traditionally had to resort to phone calls and emails to initiate and track payments,” Boeke said.
And finally, integration with payment providers can be a significant undertaking that mandates substantial investments of time and money.
Among the best strategies to cut down on the paper-pushing and improve the overall payments experience, he said, is to embrace “intelligent automation.” That means leveraging a cloud-based approach — like the one CCC provides — to manage existing integrations and infrastructure between systems that a carrier may already have with other parties involved in the claims process.
“A cloud approach provides access to a lot of automation and many of the advancements that are coming from other systems,” Boeke told PYMNTS. “It takes some of the burden of managing those connections off your plate.”
By way of example, he said that with this approach, bill payment systems can be connected to claims systems, and new payment methods can be onboarded with ease, including digital wallets, same-day ACH, and payments “pushed” directly to debit cards. Real-time payments lie just on the horizon too.
As he told PYMNTS with a nod toward what’s to come: “Real-time payments are starting to gain steam here — where you can start to get instantaneous bank-to-bank payment transfers — and we’re going to see more of that in our B2B payments in the future.”