State Farm, Fiserv team for faster payments
No one likes to wait for insurance payouts – especially the part of spending days checking the mailbox for the arrival of a paper check, a stark contrast to the ability to make payments. online every month with just a few clicks.
State farm, the nation’s largest home and car insurer, is taking proactive steps to bring the convenience of digital payments to digital payments. A new partnership with Fiserv will gradually deploy digital payment technology to provide speed and flexibility in auto and fire claims payments in the future.
The deal, as head of Carat and digital commerce at Fiserv Nandan sheth told Karen Webster, was created to give State Farm customers the flexibility to choose how and when they want to take delivery of their payments, while providing State Farm with a way to digitally connect with their customers.
“As we manage the inflows and outflows, I think there is a huge opportunity to make disbursements more efficient for insurance companies,” Sheth explained.
How it works
In the future, when it comes time to get paid, State Farm customers will receive an email directing them to the payment portal, where they will have three choices. The first two are to receive an ACH payment to their checking account or to receive an instant disbursement directly to a debit card. Entering information for these payments is a one-time event, Sheth said: Once they are placed in the system, the consumer can simply click and go when it comes to choosing their preferred disbursement method.
As a third option, the consumer can always choose to pay by check if that is their preference – although instead of coming by mail, said check will be sent to them as a PDF. They can choose to print it out and deposit it the old-fashioned way at the branch, Sheth noted, but consumers can also have the check deposited directly into their bank account, which only requires them to enter their name. bank user and password. Or the consumer can enter a debit card, choose to convert the payment to debit, and have it instantly deposited into their account.
“We’ve had a theory for a long time that insurance could be a really interesting segment, because when it comes to claims there was a lot of paper,” Sheth told Webster. “Consumers want more speed because they’re used to transferring money instantly to platforms like Venmo and then getting what they get. [from their insurance company] is that paper check. Insurance is where the market is. “
And when it comes to bringing the market to where it could be, he noted, Fiserv and State Farm are just getting started.
Modernize the payment infrastructure more generally
The new payments partnership starts with ACH, debit, and check (digitally upgraded) payments, which is a great place to start – and hundreds of millions of dollars in digital claims payments have already been made from that. way, Sheth told Webster. But it is not the sum of their efforts to expand insurance disbursement options. The next natural question, he noted, is how they can continue to offer options that may not be available today.
“Going forward, it’s going to be debit, wallets, ACH, then check,” Sheth predicted. “We’re experimenting with an even lighter version where with just one click you can collect your payment with multiple options and it’s instantaneous.”
Consumers, especially younger ones, aren’t used to waiting for checks – they’re used to getting paid instantly. And while COVID-19 didn’t create the massive push for improved and modernized digital disbursements, it was spreading beneath the surface long before the words “global pandemic” became part of the conversation.
As Sheth noted, COVID has forced the market to accelerate its digitalization across verticals – insurance, odd-job economics, employee payrolls, and more. – and created an unprecedented need for the next product evolution to meet the emerging needs of modern customers.
“COVID has accelerated everything,” he noted. “Between insurance, gambling and the odd-job economy, volume growth has been explosive.”