4 in 10 Insurers Don’t Offer Consumers the Instant Disbursements They Prefer

When consumers are given a choice, they usually choose to receive insurance disbursements via same-day account transfer or instant payment rails. It’s a finding that is consistent with the general need for speed when it comes to payments preferences.

This is explored in the study Insurance Disbursements Brief 2022, a PYMNTS and Ingo Money collaboration, based on surveys of over 2,400 consumers about payout preferences.

According to survey findings, of the $1.37 trillion in insurance claim payouts in 2022, roughly 20% — equaling about $277 billion — were sent using instant payment rails, which is the highest level seen since 2018.

At the same time, consumers chose instant insurance payouts 23% of the time, the study also revealed, noting that it was only offered as an option for 62% of disbursements in 2022, far below 2021 levels.

That was an anomalous year with COVID causing payouts to spike as 49 million individuals in the U.S. “received at least one payment from an insurance provider in the 12 months leading up to June 2022. This share is 3% more than said the same in June 2020.”

While disbursements rose in recent years, the types didn’t change. Healthcare insurance disbursements remain the common type of payout, followed by automobile claim payments, property, and casualty (P&C) insurance claim payments, with life insurance claim payouts being the least common type received since 2020.

As to how claims are disbursed, the study notes that when offered a choice in method, “consumers picked instant disbursements in 23% of the cases — up from 19% in 2021, with life insurance payouts the most common.

Per the study, “Consumers chose instant payment rails for 46% of all life insurance payouts in 2022 — well above the 11% of consumers who chose to receive these disbursements via same-day bank account transfer. Instant was the second-most chosen method of receipt for health insurance, automobile insurance, and P&C insurance payouts. Consumers chose to receive health insurance payouts instantly 20% of the time when the choice was available — just less than the 21% who chose to receive them via same-day bank account transfer.”

Get the Study: Insurance Disbursements Brief 2022