How Carriers Can Offer Policyholders Pay-as-you-go Billing in Four Easy Steps

March 24, 2022

Today’s workers’ compensation market is more competitive than ever. With more carriers in the space and premiums dropping, all five of the top workers’ comp carriers are now offering “Pay-as-you-go” billing options to boost customer acquisition and retention.

Based on our analysis of our 30+ carrier customers, Pay-as-you-go billing can not only improve customer retention by up to 10%, but it can also reduce uncollectible premiums/bad debt up to 75% and reduce audit costs up to 50%.

In as little as 30 days, carriers can now offer customers Pay-as-you-go billing (connected to 2,000 + payroll providers) using our white-labeled solution. In the sections below, we’re going to demonstrate how InsurePay Pay-as-you-go works.

Once a business owner buys a policy with a Pay-as-you-go billing option from their agent, a policy will be issued by a carrier in the same fashion as any other bill plan.

Typically, carriers will submit the following information to InsurePay Pay-as-you-go via web service integration:

Policy number and effective/expiration dates of coverage
Policyholder’s name, EIN, and address
Policyholder contacts, phone and email address
Rating data (eligible state(s), class code(s), est payroll/premiums)
Total policy premium

InsurePay Pay-as-you-go Automatically Collects Payroll Data and Calculates the Premium

Once an account is created, InsurePay Pay-a-you-go will request information from the policyholder’s payroll company or the policyholder if they prefer to self-report. This information will then be used to automatically calculate the premium (even for different employee classifications) for the payroll period.

InsurePay Pay-as-you-go will calculate the premium amounts based on the payroll check date submitted by the payroll provider or policyholder. After that InsurePay Pay-as-you-go will send out an email to notify policyholders about the amount to be withdrawn from their authorized bank account.

Along with calculating the premium amounts, InsurePay Pay-as-you-go will also automatically implement key individual minimum and maximum payroll amounts and capping rules for all NCCI states and independent bureau states (some exceptions may apply).

InsurePay Pay-as-you-go Automatically Collects Payroll Data and Calculates the Premium

Once an account is created, InsurePay Pay-as-you-go will request information from the policyholder’s payroll company or the policyholder if they prefer to self-report. This information will then be used to automatically calculate the premium (even for different employee classifications) for the payroll period.

InsurePay Pay-as-you-go Creates Daily Remit Files to Assist with Account Reconciliation

Next, InsurePay Pay-as-you-go will generate a daily remit file which can be used by a carrier’s finance department to reconcile payments. This file will include information about each day’s pay-as-you-go billing transactions, such as:

New billings
Re-billings of failed transactions
ACH returns

Furthermore, it’s also possible to update a policyholder’s information throughout the policy lifecycle. Whether it’s a renewal, endorsement, reinstatement, or cancellation, InsurePay Pay-as-you-go makes it easy to update information and keep premium payments in sync at all times.

Next Steps

InsurePay has been successfully helping carriers of all sizes implement Pay-as-you-go billing. If you’re thinking about partnering with a solution provider and would like to learn more, we’d love to help you out.