Cards give policyholders quick claims cash
Traditionally, insurance companies have paid out claims using checks. For some, the time it takes to deposit or cash insurance checks might be too long.
To address this problem, insurers are increasingly turning to stored-value debit card systems. Policyholders can use the stored-value cards to get cash immediately, or make necessary purchases. Insurers say the cards get money to policyholders faster, and help customers who don’t have bank accounts.
Insurers can also save money, since the plastic cards can be cheaper to process than checks.
Insurance companies can offer different types of debit cards based on their needs. WildCard Systems Incorporated offers four card products to insurance companies. "A stored-value card is a better way to get payments to customers more rapidly," says Gary Palmer, WildCard Systems chief operating officer.
WildCard’s stored-value cards carry the Visa or MasterCard logo. The cards are mailed to individuals after a claim is reported. Using a personal identification number, policyholders can get their money from automatic teller machines. They can also use the cards to make purchases.
Among the companies using WildCard’s system are Amica Mutual and The Hartford.
Amica is offering policyholders a Visa card, which will give them immediate access to cash when they file a claim.
|"We believe that ClaimCard's leading-edge product will help us better serve our customers."|
When an Amica policyholder files a homeowners or auto insurance claim, an Amica adjuster will provide the customer with a “ClaimCard.” ClaimCards can be used to access money at ATMs, or pay for temporary housing expenses or emergency work to be done by housing contractors.
"Amica is committed to technology that leverages the web and we believe that ClaimCard's leading-edge product will help us better serve our customers," says Mark Divoll, assistant vice president for claims at Amica.
Ideally, ClaimCard will be used for immediate expenses. For example, if you needed to stay in a hotel because of a fire in your home, Divoll says the ClaimCard could pay for the room. The card is accepted at all ATMs and at all locations where Visa is accepted.
Divoll says adjusters will have the ability to program the card to give it a specific cash value. If the amount of money on the card proves to be more than what the expenses are, the policyholder must return the card with the remaining money on it. For example, if an adjuster issues a card for $5,000 to have some auto bodywork done, and the repairs cost $4,500, the policyholder does not get to pocket the $500 left over, Divoll says.