The Challenge: Traditional payment methods are deeply embedded, restricting policyholders from selecting their preferred payment options.
The Solution: Empowering claimants with their preferred payment methods adds greater convenience, appeals to multiple demographics, and boosts overall satisfaction.
For property and casualty insurers, retention is heavily influenced by customer satisfaction, particularly because policyholders typically engage with their insurance carriers only once or twice a year. This is in stark contrast with other financial-service industries such as banking, where customer interactions take place ten to 20 times more often.
Keeping new and current customers satisfied is largely dependent on the claim payment experience. According to a 2025 Claims Experience Survey, 40% of claimants rank the time it takes to receive payment as the single thing they’d most want to change about their claims experience. Policyholders expect a fast, seamless claim experience with the latest payment options — making speed and the ability to select how they’re paid a key competitive differentiator.
The traditional method of paying insurance claims by check largely contradicts these expectations. In a world of instant gratification, waiting five to seven days for a check to arrive in the mail can greatly hinder customer relations. Checks also continue to be the payment method most vulnerable to fraud, with 58% of organizations reporting check fraud in 2025.
While ACH transfers improve payment speed to just two to four days, digital disbursements can deliver funds to claimants within minutes. This speed matches what consumers already expect: 90% of consumers say they’d choose the instant payout option if offered, and because digital claim payments are available 24/7, claimants get paid on their schedule without adding work for claims staff.
Timely claim payments are directly tied to satisfaction, whether for natural disaster recovery, workers’ compensation, theft replacement, or other urgent needs. By empowering claimants with multiple payout options, including instant claim payouts and same-day bank transfers, insurers can cater to diverse preferences and strengthen loyalty.
Understanding Generational Payment Preferences
When it comes to payments, there’s a distinct divide in generational preferences. A 2025 survey found that Millennials (18%) and Gen Z (20%) are notably more likely to prefer mobile wallets for claims payments than Gen X and Baby Boomers. For older generations, debit cards and traditional banking channels remain the default. The gap is wide, and it's growing as younger consumers age into prime insurance-buying years.
This generational divide highlights a pivotal opportunity for insurers. Preferences have shifted decisively toward digital: 58% of claimants now say they prefer direct deposit for claims payments, compared to just 20% who prefer printed checks. Expanding payment choices is one of the most direct ways to close the gap and keep policyholders from looking elsewhere.
Meeting Customers Where They Pay
Meeting customers where they are means recognizing their lifestyles and generational preferences because these aren't hypothetical preferences. They're actual usage patterns that tell insurers which rails to prioritize.
The broader point holds: 85% of claimants who are offered a choice of payment method report a positive experience. That flexibility builds trust. When customers feel their financial preferences are understood, they're more likely to stay. Payment choice then turns the claim process into a retention tool that resonates with today’s digitally driven consumers.
Looking to empower your claimants with payment choice? Learn how our fully digital payment experience makes it simple for claimants with flexible, self-service payment options, including digital and revenue-generating methods.