Will Embedded Insurance Ease the Claim Settlement Process?


Ever since insurance moved online, policy purchase has become much more streamlined. Buyers can finalize and pay for an insurance plan through the seller’s website or digital app. A few taps, a few clicks, and done! But while buying insurance feels seamless much of the time, claim settlement does not.

Policyholders still have to jump through hoops to get their claims approved. Intimate the insurer in time, provide the necessary paperwork, and make sense of vague information about settlement processes, there is a lot to do.

Insurers don’t have it easy either. Personnel must sift through many documents and details when assessing a claim. Claim processing is time-heavy and resource-intensive, and it adds to operational expenses while eroding profit margins.

To put it bluntly, claim settlement could do with a revamp and insurtech could help. Embedded insurance is already disrupting how insurance is sold. Could it also play a part in speeding up the clunky claim settlement process?

What is Embedded Insurance?

The extended warranty that you pay extra for while buying electronics is a type of embedded insurance plan. Other examples include travel insurance getting bundled with flight bookings and auto insurance being sold along with a new car. The insurance thus gets embedded into transactions involving other non-insurance products and services.

How do these offerings get integrated into digital platforms? Credit to the application programming interfaces (APIs) that operate behind the scenes. An API is software code that allows communication between different applications, platforms, operating systems, and other software components.

The car dealership that sells you a smart car adds an embedded insurance API to its sales platforms. By doing so, the dealership is able to view and access the insurance plans offered by participating insurers. When a customer logs on to the dealer’s website or app, the API analyses the available customer information and pushes out a tailored policy offering. Being in purchase mode already, the customer may be willing to shell out a little extra and buy the add-on policy.

The technology behind embedded plans makes policy purchase seamless. Unfortunately, should the car buyer need to file a claim, later on, the claim settlement process may not be quite as hassle-free.

What is Blocking Claim Settlement?

The claims process seems to be stuck in the past. Here is a quick look at the three culprits that increase the turnaround time (TAT) for claim settlement:

  1. Extensive Paperwork: Filing a claim involves massive amounts of paperwork. For example, to claim against a health insurance policy, one must furnish prescriptions, diagnostic reports, and hospital and pharmacy bills. The insurer goes through these documents with a fine-tooth comb to assess if all is in order. Sometimes, supporting documents are requested. The checks are done manually, which pushes up the TAT.

  2. Complex Workflows: In FY 2020-21, life insurance companies in India received 11.01 lakh claims. Insurers settled 10.84 lakh of these claims, paying out benefits worth Rs 26,422 crore (Source: IRDAI). And this is just the life insurance segment. Because the stakes are high, the insurance company employees evaluate each claim thoroughly to weed out frauds. False claims are a big expense for insurers, which is why their checks are so time-consuming.

  3. Legacy Systems: Traditional insurers still rely on legacy systems—in other words, outdated operating systems and platforms that use older programming languages. The problem is that current technology has far outpaced the older systems. As a result, legacy software may not combine well with the latest in tech, leading to operational inefficiencies, frequent maintenance and patchwork, and delayed claim settlement.

Insurtech and the Future Claims Process

The technology used to embed insurance into transactions for other products and services could help. Embedded insurance already uses APIs to do the heavy lifting in the backend. In future, perhaps APIs could also be harnessed to ease how claims are settled. Here’s a look at what claim processing might look like in the years to come.

1. Claim Processing

When filing a car insurance claim after an accident, you have to furnish several documents. These include copies of the policy, the driver’s licence, the car registration certification, and the FIR filed at the police station, plus photographs of the damaged vehicle.


What if you could get technology into the mix? APIs could instantly send a GPS location of the accident site, along with information about vehicle damage to the insurance company. They might even prompt the insurer to arrange for medical support and car breakdown service. API tech could then initiate the claims process by auto-filling your saved details into a claim form. And you could add supporting photographs through the relevant platform.


The technology would thus initiate the claims process and you would just have to follow along. No need to fumble through it all on your own. Such a customer-first approach could yield dividends in the coming years. And as insurers make good on their commitment to safeguarding policyholders from financial risk, customer satisfaction is sure to grow.


2. Personalization and Risk Assessment

Artificial intelligence (AI) and machine learning (ML) are already being used to analyse customer data and create embedded offerings in real-time and across devices. The future of bundled insurance could involve even more personalization.


If you wear a fitness tracker, APIs could pull up the device data and create a personalized health insurance quote. Alternatively, say you apply for auto insurance for your smart car. AI and ML could be harnessed to assess your risk profile via third-party APIs that you already use. And with Internet-of-Things (IoT) devices becoming more commonplace, the possibilities are endless!

Increasing automation will help insurers to evaluate risk and fact-check information much faster. Underwriting times would go down, and so would claim processing TATs.


For example, when a user self-reports their daily level of activity, there is the risk of overestimating or underestimating the time spent. But a fitness tracker will not lie. It could provide a far more accurate picture of the user’s activity levels, as well as calories burned, heart rate, blood oxygenation, and other markers. Insurance companies could then evaluate the user’s risk profile more effectively.

When risk evaluation gets simplified, insurers would be able to provide bespoke products for customers through embedded insurance offers. This would lead to fewer surprises during claim settlement, thus easing the workflow and improving the TAT.

Insurance Bundling with Turtlefin

Insurance delivery mechanisms are undergoing a massive change. Embedded insurance is the future and the potential for both gains and happy customers are growing. Are you ready to hop on board and see where it takes your business? Turtlefin can assist you there!

As experts in insurance and technology, we help you to forge ahead in a changing landscape. Our plug-and-play API makes short work of the integration process. The Turtlefin team will set up the API for you, giving your business the embedded advantage without interrupting regular operations. Not only that, our support team will address all tech issues that may arise during your journey.

Embedded insurance can be an excellent revenue stream for your business. With no inventory or stores to maintain, you can enter the insurance vertical with very little investment. Your customers can pick up a policy while shopping as usual on your sales platforms. From the premium quote to the policy purchase, everything happens digitally, with no need for intervention by your staff.

Insurance thus becomes a value-added service from you to your customers. They get personalized insurance plans bundled into everyday transactions, which cuts out the need to seek insurance separately. The Turtlefin API ensures a seamless transaction experience across all devices, apps, and platforms, creating a tribe of happy customers who stay loyal to your brand.

As disruptive changes transform the insurance sector, businesses that can realign their business models are poised to make big gains. Turtlefin could guide you through it all, helping you boost your earnings and supporting your customers to get insured.



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