Insurance bills are one of the top three bills – accounting for 18% – paid monthly by U.S. consumers, according to The Speedpay® Pulse. The Speedpay® Pulse, a consumer billing and payments trends and behaviors survey of at least 3,000 U.S. adults responsible for two or more household payments a month, found that many consumers are already using – and prefer to use – digital services to pay their insurance premiums. Based on surveyed consumer preferences, digital and mobile offerings are a growing opportunity for insurance companies to manage and conduct their billing and payments services.
Demand for Digital Payment Channels
When looking at the channels that consumers use for a majority of at least one of their one-time insurance premium payments*, two of the top three channels are digital. The top channels are a company’s website (38%), mail (29%), and bank’s website (15%). Insurance companies should meet the demand for conducting payments directly through their website by ensuring they integrate a seamless billing and payments platform. By catering to customers and providing online payment services directly on their website, insurance companies can increase customer satisfaction and provide customers with the ease and security of conducting payments through a direct payment channel.
Additionally, of those who pay insurance premiums*, 6% prefer to make one-time bill payments through a company’s mobile app. While adoption of mobile platforms is currently low for paying insurance premiums, incorporating mobile offerings will be critical for the future.
Diversified Payment Methods
With the rise of digital and mobile channels providing more payment options, consumers are choosing to use cash less frequently. When looking at the methods consumers use for a majority of at least one of their one-time insurance premium* payments, consumers are most likely to use a checking account deduction (34%), debit card (27%) and credit card (21%), according to the survey. Insurance companies must adapt to various payment methods and provide flexibility in their digital platforms for customers to pay in their preferred method. With consumers being less likely to use cash to pay insurance premiums, digital services are an ideal fit for insurance billing and payments.
Rise in Digital Notifications
Consumers prefer digital billing statements and notifications for their convenience, speed, and simplicity. Among those surveyed, most consumers (37%) solely receive digital insurance billing statements, compared to those who receive only paper (34%), both digital and paper (13%), or no billing statements (16%). The results show a trend among consumers of migrating to digital billing statements. While some consumers still opt to receive paper statements, insurance companies should incorporate a digital platform that is easy to read and navigate so consumers can feel comfortable - and confident - in making a digital migration.
Where Can Insurance Companies Go from Here?
There is opportunity for growth beyond the current usage of digital and mobile services among consumers paying insurance premiums. The Speedpay® Pulse found that 1 in 4 consumers in general would consider using a mobile wallet to pay their bills in the future. Consumers are showing a growing interest in and comfort with innovative digital and mobile technologies. Of those using mobile services, one of the main benefits noted was convenience. Insurance companies can take note from overall consumer trends and take action now to expand their digital and mobile billing and payments offerings.
As insurance companies develop and integrate new technologies into their services, it’s important to educate customers on the benefits of the available digital and mobile platforms to break down the barrier to adoption.
*Premiums include health insurance, auto insurance, property insurance, life insurance, and disability insurance.
*Source: Speedpay® Pulse, 2018
To learn more about consumer payment and billing preferences for insurance premiums, click here to see the full infographic.