Why Outdated Payment Systems Are Holding P&C Insurers Back

As digital claims, AI, and automation redefine insurance operations, many carriers are overlooking a crucial weak spot: payment systems. While insurers invest heavily in front-end innovation, back-office payments often rely on outdated infrastructure that hampers efficiency, frustrates customers, and introduces compliance risks.

In 2024, the P&C industry wrote over $529 billion in direct premiums, yet many insurers still manage collections and disbursements through manual processes and disconnected systems. These inefficiencies are no longer just internal headaches—they’re damaging customer trust at pivotal moments, especially during claims. Delays in payouts and limited payment options stand in stark contrast to the instant, seamless experiences consumers expect.

Modernizing the payment function means more than speed. Real-time disbursements, integrated digital wallets, automated compliance, and seamless vendor onboarding can transform payments from a cost center into a competitive differentiator. It’s not about replacing core systems entirely, but integrating scalable platforms that offer visibility, agility, and control across the financial journey.

Insurers that fail to modernize risk falling behind as tech-savvy competitors, including insurtechs, capture market share by offering better experiences. As regulatory scrutiny intensifies, and customer expectations climb, insurers must treat payments as a strategic priority—not a back-office afterthought.