You’ve had the conversations. You’ve read the articles. You’ve seen it firsthand — the digital insurance model is becoming the new reality. In fact, according to data gathered by Mordor Intelligence, the digital insurance market is estimated to reach $148.15 billion this year. And over the next five years, it’s expected to grow at an average compound annual growth rate (CAGR) of 11.51%.
Meanwhile, insuretechs continue to disrupt the industry by leveraging cloud-based delivery. Competitors are leveraging artificial intelligence (AI) to accelerate and personalize underwriting, pricing, and claims management processes. Customers are demanding instant responses and claims updates delivered to their mobile devices.
While much of this digital transformation has focused on customer-facing innovation, insurers who modernize their back office — especially accounts receivable — can unlock faster cash flow, improve customer satisfaction, and dramatically reduce administrative burdens.
In this article, we’ll address how A/R automation can help revolutionize your business, what that might look like, and why it’s beneficial.
The A/R burden facing today’s insurance providers
Across insurance types and market sectors, outdated workflows and billing technology continue to be a stumbling block for most insurance providers. Paperwork involves literal paper. Pertinent policyholder and claim data are rekeyed between systems. Processes stop when everyone goes home for the day. And as a result of these manual invoice cycles, your days sales outstanding (DSO) steadily increase. You spend excessive amounts of time and labor tracking premium payments, and errors become far too commonplace.
Managing A/R in insurance is uniquely complex. You need to coordinate across revenue streams that come from more than just direct customers, such as reinsurance payments or subrogations. You face increased reconciliation friction as you match documents across claimants, service providers, brokers, and more. Regulatory burdens tied to policyholder privacy and financial reporting can be quite intense.
Commonly, insurance billing departments find themselves struggling with:
- Late payments
- Manual errors
- Recurring invoices
- Paperwork discrepancies
- Process bottlenecks
- Increased labor demands
- Complicated reporting
These challenges impact cash flow, tie up resources, and frustrate policyholders. Fortunately, A/R automation platforms like Invoiced are specifically designed to address these issues, enabling insurers to eliminate manual A/R inefficiencies without disrupting core operations.
What does A/R automation look like in insurance?
Imagine automatically generating your invoices without any direct employee oversight — each filled with data pulled directly from your enterprise resource planning (ERP) solution. These payment requests are sent, tracked, and managed via centralized workflows that include built-in document matching and verification efforts. Templated, multi-channel dunning messages are sent at regular intervals for each outstanding invoice, encouraging policyholders, reinsurers, and other parties to make payments promptly, well before the due date.
These debt holders, in turn, serve as proactive partners in the invoice-to-cash (I2C) process, leveraging the tools you give them to actively manage their payment data, initiate transactions, and set up recurring payments for ongoing policy coverage. And as those funds stream into your business from all manner of stakeholders, your automated A/R solution will direct them to the appropriate accounts and update your reporting documents, only requiring human assistance for final authorizations or to deal with process exceptions.
Key benefits of automating A/R workflows for insurance providers
The benefits you experience depend heavily on the automation software you choose. A strong platform like Invoiced enables you to accomplish more A/R tasks with fewer resources, while specifically addressing insurance complexities. With the right solution, you can:
Accelerate premium collections and improve cash flow
In insurance, delayed premium payments can create downstream impacts on coverage, claims processing, and cash reserves. Automated workflows keep the revenue cycle moving around the clock — issuing invoices, follow-ups, and confirmations even outside business hours. Timely, consistent outreach ensures policyholders receive and act on premium notices sooner, reducing outstanding balances and improving overall cash flow predictability.
For insurers using recurring premium models, automation enables seamless subscription-based billing. Customers can set up autopay, avoiding the hassle of manual payments while helping insurers maintain steady revenue streams and lower lapse rates.
Minimize billing errors to reduce disputes and policyholder churn
Accurate billing is crucial in insurance, where even a minor error can impact coverage or raise compliance concerns. Manual processes are susceptible to data entry errors that can lead to disputes, delayed collections, and dissatisfied policyholders. By integrating A/R automation with core systems, such as policy administration and ERP platforms, insurers can ensure that invoice data is consistent, validated, and traceable across all systems. This reduces the risk of billing discrepancies and helps preserve trust with customers and partners.
Free up staff to focus on underwriting, claims, and customer experience
Insurance back offices are often understaffed, and many skilled team members spend a significant amount of time on routine billing tasks. Automation eliminates repetitive, manual tasks such as generating invoices, tracking payments, and issuing reminders, allowing staff to focus on higher-value activities. That means more time for customer communication, resolving complex issues, or optimizing collections strategies — improving both job satisfaction and overall productivity.
Scale billing operations without scaling headcount
Whether you’re dealing with seasonal renewals, new product lines, or growth through mergers and acquisitions, insurance billing volumes can fluctuate dramatically. Automated A/R systems provide the agility to handle volume spikes without overburdening teams or delaying invoicing cycles. As your business grows, automation scales with it, enabling you to process more transactions without needing to hire and train additional staff.
Simplify audits and support regulatory compliance
As you shift to automated, data-driven processes, it becomes much easier to capture and report on the critical metrics and associated metadata needed to track the performance of your business. With this information in hand, you can more easily identify process bottlenecks, recurring discrepancies, and other problem areas. At the same time, by assembling historical reports on these A/R key performance indicators (KPIs), you’ll be in a much better position to not only prove the financial strength of your business but also your overall compliance with auditors, both internal and external.
Must-have features to look for in an A/R automation platform for insurers
Choosing the right solution can make all the difference in whether your decision to automate was a sound investment. Take your time when evaluating potential platforms, and whenever possible, look for software vendors that offer trials or demos that let you familiarize yourself with the product before making a decision.
At the same time, evaluate your current accounts receivable (A/R) efforts and identify which activities are the most time-consuming, error-prone, or otherwise problematic. Then look for a solution that can address those challenges. In particular, we recommend that you choose a platform that delivers:
- Customizable workflows: What works for you today may not work for you tomorrow, so look for a solution that lets you modify your A/R operations to match your shifting needs
- Cash application tools: Routing incoming funds by hand can be complicated, especially if these payments apply to multiple claims
- Dunning support: Just sending a payment request is rarely enough; you want to remain in constant communication with your policyholders and partners regarding any outstanding invoices
- Easy payments: When you make it easy to give you money — such as through AutoPay functions or a payment portal — your policyholders will tend to be much more responsive
- Integrated reporting: The data and metadata you need to fine-tune performance and document compliance already exist in the system, so prioritize a solution that makes it easy to access them
- Recurring billing: More than likely, your policies will require regular premiums to keep them active, meaning you’ll want a platform designed explicitly for subscription-based billing
How Invoiced supports A/R automation for insurance providers
Insurance companies face unique challenges in billing and collections management. Invoiced’s Accounts Receivable Automation software is built to meet those challenges head-on.
Our platform supports complex invoicing requirements, addressing discounts, credits, deductions, and disputes with ease. Thanks to the global payment capabilities of Flywire software, you can even leverage our solution to accommodate international policies and accept premiums in 140 currencies.
Recurring billing is seamless, letting you create policy tiers, customize payment terms, and monitor performance metrics in real-time. Our Automation Builder feature also enables you to modify these invoicing workflows on the fly, ensuring your processes evolve in tandem with your business.
To make payments simple, policyholders use our self-service portal to initiate premium payments, set up AutoPay, download statements, and renew policies — all through a branded, user-friendly interface.
As payments are received from policyholders, reinsurers, or subrogation parties, our proprietary CashMatch AI automatically credits the correct accounts, invoices, and balances without requiring staff intervention.
Ready to automate your A/R Process?
Invoiced helps insurance companies modernize A/R operations, eliminate manual tasks, and speed up collections across all revenue streams — from policyholders to reinsurance.
Want to see how it works in action? Schedule a demo today and discover how A/R automation can drive measurable impact in your business this quarter.
