Slow Claims Payouts Push Insurance Policyholders to Switch Carriers

Insurance once sold peace of mind. Today, peace of mind arrives in milliseconds—or not at all. When policyholders file a claim, they are not benchmarking insurers against other carriers. They are benchmarking them against the rest of their digital lives, where money moves instantly and options are table stakes. If the payout lags, the brand suffers.

This urgency is growing as environmental and economic pressures converge. Catastrophic weather events are driving up insurance claim volumes. Policy shopping is reaching record levels, turning retention into a battlefield. At the same time, satisfaction data indicate a systemic breaking point. More than one-third (38%) of auto policyholders now fall into the lowest satisfaction segment. Just 51% of customers with high lifetime value (long tenure, multi-policy, higher premiums) say they “definitely will” renew, making retention of this profitable segment a top industry concern.

The industry’s math has changed. Affordable coverage attracts buyers; fast claims keep them coming back. Forty-six percent of insurance claimants say payment velocity is their top priority—eclipsing concerns like convenience, choice or security. For catastrophic claims, the stakes are even clearer: 51% of policyholders cited quick payouts as their top priority during severe-weather claims.

The technology impact is no longer theoretical—it shows up in the rails insurers choose for payouts. Sixty percent of consumers receiving instant insurance disbursements prefer push-to-credit card, followed by digital wallets at 56% and instant bank deposit at 50%. The signal is clear: Instant disbursement is now infrastructure, not innovation.

Equally telling is the customer’s willingness to pay for speed. Nearly one in four consumers receiving payouts between $500 and $1,000 say they would pay fees for instant access—a signal that urgency carries quantifiable value.

Insurers that cling to paper checks or slow batch rails aren’t just making payments late. They are affecting loyalty. The industry’s next battle for market share will not be won based on price or policy terms. It will be won in seconds.

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“The Money Mobility Tracker®,” a collaboration with Ingo Payments, examines how insurers are modernizing claims through instant disbursements, expanding customer choice and transforming payout speed into a competitive advantage in retention, satisfaction and market share.

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