Print Article for : Insurance Claim Processing Services

[I349]Insurance Claim Processing Services

by Tele Genisys, Tel

Of all insurance related services, claim-processing services are perhaps the most critical because they make all the difference between the success and failure of an Insurance company. No doubt, the policy terms and conditions also play a major role, but since ultimately it is the quality of claims processing services that determine whether or not a customer will remain loyal, insurance companies just cannot afford to be lax on this front.

The insurance business relies heavily on references and this is another good reason as to why Insurance companies should always try to offer the best possible claims processing services to their customers. If an Insurance company fails to provide efficient claim processing services, it’s highly unlikely that customers will refer the company or its services to their family, friends and associates. In the worst case scenario, customers can even create a bad name if they get a bad deal and are hugely dissatisfied with the company’s claim processing services.

So, what can insurance companies do to maintain the quality of their claim processing services? Well, there are many options available such as hiring professional talent and increasing the size of the claims department. However, since all these options are not all that affordable, it is recommended that insurance companies look out for other low-cost options that might be available.

One of the most cost-effective options that most of the Insurance companies are using nowadays is quite obviously the Insurance outsourcing services. These services are offered by BPO (Business Process Outsourcing) companies, some of which specifically handle insurance claim processing. Third party BPO’s are able to offer high-quality services at reasonable costs because they rely heavily on automated claim processing systems. These advanced software systems complete most of the tasks automatically, leaving very little to be done manually. As such, additional staff is not required, something that allows BPO’s to reduce their operational costs and consequently pass on the cost benefits to their clients.

However, it is advisable that Insurance companies take a few precautions before actually outsourcing their claim processing services obviously because not all BPO’s offer the same level of services. To ensure that only the best outsourcing firm is selected, Insurance companies should first assess BPO’s on the following criterions:

Domain experience: Since Insurance outsourcing services can include everything from sales, marketing, renewals, back-office, claim processing etc, it would be better if insurance companies check out what specifically is the domain of a particular BPO. A BPO dealing specifically in claim processing can be given preference.

Security setup: Insurance companies first need to figure out whether or not the outsourcing firm has setup the required security systems, necessary for maintaining the confidentiality of personal data of customers. Preference should be given to outsourcing firms that might offer the highest level of protection against data theft and it’s eventual misuse.

Concentrating merely on the cost benefits may save insurance companies a few thousand bucks, but since lack of quality can as well result in millions of dollars in losses, it is always better to first ensure the quality of claim processing services and then only start looking for cost benefits. For more information on how and where to get the most cost-effective claim processing outsourcing services, just click here.

Most successfully businesses use one or more 3rd party payment processing services to process their credit card orders on Internet, since this doesn't require to obtain a direct merchant account or to setup expensive ssl certificates. The 3rd party payment processing services handles payment by credit card (and usually can handle checks and other forms of payment as well), and sends the seller a monthly (typically) check or wire transfer, minus various processing fees, which vary from service to service.

These 3rd party payment processing solutions give the seller a link to a secure webpage where they can redirect their customers to, for completing the order. While the method has many benefits, it also has disadvantages.

Below I would like to make an introduction of the basic terms and concepts used by the standard payment processing services, to help sellers understand better what they need to compare when choosing an payment processing service.

Payment Cycle

- the time interval during which orders are taken for one payment. Can be monthly, bimonthly, weekly, etc. After each payment cycle ends, the payment should be sent to the seller.

Payment Hodling Time

- unfortunattely every payment processing service deliberately holds the payment for an amount of time that varies between a few days up to several months. They do not send the payment immediately after the payment cycle has ended, but instead they hold the payment for the specified payment holding time. They say this is to protect them against fraud, chargebacks, and it also helps them with increasing their profit ( by holding the money in bank for an interest ). For example, for a monthly payment cycle and a payment holding time of 15 days, the money resulting from orders during October will be sent to you on or after 15th November. This is not a big issue if the payment holding time is not long, but some services have a payment holding time of 2 months or more, and you will receive your payment for October sales in January the next year.

Payment Processing Day

- is the date of the month ( for montly payment cycles ) when the payment cycle should end, and the payment calculated. Usually this is the last day of the month, but some services let you specifically set it.

Signup Fee

- the fee for signup. Some charge non-refundable fees, other application fees, other do not charge a fee at all.
Transaction Fee

- the per transaction fee, usually a percentage with a minimum fixed value.

Chargeback Fee

- when a chargeback occurs ( it happens in case of fraudulent orders or when the customer is not satisfied with the product ) not only that the payment processing service takes back the amount of the order, but it also charges you with a chargeback fee.

Some payment processing services have additional fees, such as product download fee ( for virtual goods ), monthly fee, statement fee, refund fee, wire transfer fee, contract canceling fee. You need to ask them about all these fees, because most services do NOT clearly specify it on the website nor in easy to find documentation; and you might have unpleasant surprises later if you do not. Especially with the payment holding time, it's disappointing to expect to receive the first payment just to find out that it will be sent to you months later.

It is a good practice to read the TOS ( terms of services ) and the contract before signing up, as many payment processing services state they reserve the right to terminate or suspend their services to any customer, for any and no reason at all, without notice, and they also state that the last payment will be held 6 months, for chargeback protection.

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Both Tele Genisys & Alex Marias are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Tele Genisys has sinced written about articles on various topics from . Business Process Outsourcing (BPO)at www.telegenisys.com. Tele Genisys's top article generates over 6600 views. to your Favourites.

Alex Marias has sinced written about articles on various topics from Computers and The Internet, Computers and The Internet. . Alex Marias's top article generates over 6600 views. to your Favourites.