Reconciliation

How modern payment infrastructure is reshaping the insurance industry I have been working in insurance for more than 25 years. Few concepts have irritated me more than the bordereau. In a digital world where artificial intelligence is advancing rapidly, the bordereau remains a central element of the insurance industry. Brokers and agents collect premiums, transfer them to the insurer’s account, and accompany them with the ever-present bordereau. Commissions retained? Another column in the bordereau. Claims paid by third parties? Reported through bordereaux as well. Bordereaux exist as a way to explain money flows after the fact. The money is in the account, and the bordereau follows to explain what it relates to. And no, this is not a local peculiarity. The bordereau is just as present in the elegant London market. The reality is simple. Money moves through outdated systems, while data follows in separate files, often in the ever-reliable Excel. Fortunately, we do not have to remain in Dante’s inferno. There is hope. For a long time, payment systems in insurance have been treated as simple utilities. Necessary, but without strategic importance. This is starting to change. Modern systems for payment collection and processing are emerging, supporting the payment methods widely used in other industries. Today’s infrastructure enables continuous control over money flows and real-time reconciliation. Premiums are collected based on clear payment instructions, either into the broker’s account or directly into the insurer’s account, with automatic allocation. This is where the difference becomes clear. Commissions are generated instantly, not after 45–60 days, once someone has managed to decipher the bordereau. Funds collected in the broker’s account can be split directly between commission and the premium due to the insurer. At the same time, the system can automatically calculate and allocate commissions to the broker’s assistant. Instead of operators importing and checking bordereaux, systems process transactions and allocate them automatically. Manual intervention is required only to handle exceptions. Cash and capital positions become visible to the finance function almost in real time. The need to maintain blocked liquidity, to compensate for the lack of clarity around payables and receivables, is reduced. At the same time, distribution models are becoming increasingly complex. Insurers work with more partners, across more markets, in increasingly sophisticated commercial arrangements. The volume and diversity of transactions continue to grow. A model based on post-factum reconciliation becomes increasingly difficult to sustain in such an environment. As complexity increases, reliance on retrospective explanations becomes more fragile. Bordereaux will not disappear overnight. They will gradually lose ground as brokers and insurers gain confidence in systems that provide direct control over money flows, rather than explanations after the fact. It is time to rethink how money flows and align with modern practices from the payments industry. Because in the end, this is not only about processes and systems. It is about trust, about how we respond when customers need us most, and about the responsibility we carry towards the communities we serve.

How payments are reshaping the insurance industry – a practitioner’s view  We had the privilege of discussing with Alexandru Lascu, Risk & Insurance Director at UiPath, the challenges faced by the insurance industry and the evolving role of automation in addressing them.  Alexandru has spent his entire professional career in insurance and brings a practitioner’s perspective shaped by years of working closely with insurers across different markets. Our conversation explored the areas where automation has already delivered meaningful progress, as well as those where significant potential still remains untapped, like modern payment infrastructure. Alexandru`s view on the limits of claims automation FinsurtechAI: Alexandru, for the last 16 years, you have sat on both sides of the table, working for insurers where you have held underwriting and claims management roles, as well as leading corporate risk management and insurance benefits functions as a client. In your experience, which areas have seen the greatest progress in automation, and which remain difficult to automate? Alexandru: In recent years, the industry has made substantial progress in automating and agentifying claims management to address long-standing pain points. Many insurers and large corporates have invested in digital First Notice of Loss (FNOL) and intake, workflow and rules automation, and improved triage and oversight. These efforts have created tangible value with faster cycle times for many types of claims, better documentation quality and auditability and stronger governance and visibility for internal stakeholders. But in many organisations, automation still stops just before money moves. Once a claim is agreed in principle and an amount is approved, the process frequently reverts to manual handoffs between claims and finance or treasury, batch payment runs over legacy banking rails and fragmented reconciliation across multiple systems, spreadsheets, and intermediaries. In other words, increasingly intelligent claims workflows frequently feed into relatively unintelligent payment processes. The next phase of progress in claims management is unlikely to come from incremental improvements in intake or workflow alone, but rather from treating the payment and reconciliation stage as an integral, data-rich part of the claims process and from connecting modern automation with insurance‑native payment rails and intelligence.  Claims payments – a source of friction FinsurtechAI: That is how we see it as well. Shall we zoom in on the points where automated claims workflows encounter friction with payment execution? Alexandru: Across the ecosystem, stakeholders encounter similar friction at the point where automated claims workflows meet payment execution. Whether viewed from the perspective of a corporate risk manager closing the books, a broker keeping a client informed, a Third Party Administrator (TPA) handling funds, or an insurer managing loss ratios and regulatory scrutiny, the same “last‑mile” issues emerge. First, we see regular delays between decision and payment – claims approves the indemnity and then hands over to finance. There are additional checks happening in claims and batch processing.  Second, stakeholders in the company have limited real-time visibility into where money actually sits – with the company in treasury, or with the TPA?  Reconciliation burden introduces operational risk and consumes time and resources. For most insurers, it is still difficult to link each payment cleanly back to a specific claim, coverage, and vendor. The opportunity – an insurance-native payments layer FinsurtechAI: These are more than minor operational irritants. Claims decisions have become faster and more consistent, but the downstream flow of those decisions into payments, and the return of payment data into claims, finance, and risk processes, has not received the same level of attention. Alexandru: Exactly, and this is why I believe that the next wave of transformation will need to focus on this shared pain point. Connecting automated claims workflows with an insurance‑native payments layer does not simply address a back‑office annoyance; it unlocks value for every participant in the chain. First and foremost, clients will benefit from faster, clearer outcomes. Brokers and TPAs will benefit from reduced operational friction and compliance exposure. For insurer, this will translate into better control over leakage, provider networks, and claims inflation. The struggles are similar across stakeholders because the underlying gap is the same. The opportunity to address it is, therefore, also shared. Beyond claims – premium reconciliation issues FinsurtechAI: When we discussed with several COOs, CFOs, and Chief Claims Officers, our initial idea was to focus exclusively on claims. However, many C-suite executives are still facing problems with premiums reconciliation. You came across several existing payment systems in insurance. What is your experience? Alexandru: Finance teams across insurers and intermediaries regularly encounter structural friction in premium collection and reconciliation flows. Broker remittances are frequently received net of commissions and discretionary discounts, without the line-level detail needed to reconcile what was expected against what was received. Aggregated payments prevent policy-level allocation, creating reconciliation backlogs that consume significant finance operations resource. Undocumented discounts and commission deductions create compliance risk and limited visibility into whether broker authority limits are being respected. On the other hand, delays in commission payments create incentives for brokers to net premiums rather than remit gross, further complicating reconciliation These are not edge cases. They are systemic features of how premium flows are managed across much of the market, and they represent a meaningful source of revenue leakage and operational cost that has received insufficient attention. Structural constraints in claims payments  FinsurtechAI: What are the typical structural constraints you have seen when it comes to payment systems in claims? Alexandru: On the claims side the payment infrastructure often remains misaligned with how modern insurance is expected to function. Decisions are made in claims systems and then “dropped” into legacy payment processes that were never designed for multi-line, multi-country, multi-party insurance ecosystems Insurers continue to rely on payment rails and formats that provide limited remittance information and almost no structured, line-level data that can be fed back into pricing, reserving, or vendor management A high degree of fragmentation persists: brokers, TPAs, Managing General Agents (MGAs), and various internal functions each hold pieces of the process and fragments of the data This misalignment means difficulty to obtain a clean, near real-time view of who has actually been paid, on which claim, under which policy, and through which intermediary. We see claims leakage

For years, payments have been treated as the backstage crew of the insurance world. Invisible. Underfunded. Nobody’s innovation priority. But that quiet corner is now one of the most potent levers insurers can use to transform the customer experience, improve operational efficiency, and unlock new growth. And it is long overdue. Let`s dive deeper into what payment innovators have in store for us. And never forget – innovation often comes from the edges. Frictionless Payments Are Not a Nice-to-Have When was the last time you received a paper invoice from Netflix? Exactly. Most industries have long moved on from slow, manual, and fragmented payment processes. Meanwhile, in insurance, paper checks, cash and clunky bank transfers are still far too common. But the tools to change this are already here. Thanks to global schemes like Mastercard and Visa, and modern platforms like Adyen and Stripe, insurers finally have access to the kind of payment capabilities others have used for years. And this goes well beyond just moving money faster: This is not innovation for the sake of it. It is about building a system that works — quickly, securely, and at scale. Because in today’s world, payments should not be an afterthought. They should be an advantage. Payments Drive Growth (Yes, Really) Payments are often treated as a backend task — the final step to wrap things up. Necessary, but not strategic. That mindset is outdated. The reality is, payments have become a powerful lever for growth. When done right, they do much more than make customers happy. They create tangible business value. Faster payouts mean less frustration and more loyalty. A smooth claims experience is not just about empathy — it directly impacts retention. On the operational side, the ability to settle instantly with suppliers builds stronger partnerships and helps deliver better service faster. Digital-first payment capabilities are also unlocking entirely new segments. In markets where traditional banking does not reach everyone, flexible payout options open the door to underserved customers — while reducing the cost of service. And then there is the data. Every transaction holds insight: when people engage, how much they spend, what timing works best. Used wisely, that data can shape smarter product design and more precise go-to-market strategies. Even payment flexibility can be a differentiator. Offering options like split or staged payouts gives customers greater control over their finances — a small feature that can have a big impact on satisfaction. Let us say it clearly: payments are no longer the end of the customer journey. They are part of the product itself. When payments are fast, smooth, and intelligent, everything else flows better — from the way your teams operate to the way your customers feel to the way your business grows. It Is Time to Rethink Engagement When was the last time someone in a car accident opened the App Store? Exactly. And yet, many insurers still pour resources into apps that remain untouched — especially when it matters most. Claims are emotional. Messy. Urgent. They are not the moment to ask someone to download an app, reset a password, or wait on hold. But what if, at the point of sale, you gave the customer something simple — a digital wallet card? Nothing flashy. Just a quiet, useful tool that lives on their phone and springs into action when needed most. That card becomes a personal command centre: No detours, no downloads, no delays. Just one simple space that does what it needs to do — when people need it most. This is what modern engagement looks like. Not asking customers to adapt to your systems, but integrating into theirs. Because when claims go smoothly, trust builds. And when trust builds, so does long-term loyalty. Inclusion Demands Local-First Payment Design Not every customer lives in a card-based world. And not every claims journey runs through a bank account. In many parts of the Global South, cards are the exception rather than the rule. What truly matters are the systems people already trust and use — mobile wallets, mobile money networks, direct-to-account transfers, and cash-out options where digital infrastructure is still limited or unreliable. Designing for inclusion means starting with reality. It means recognising how people actually receive and move money, not how we imagine they should. If your payout system does not reflect local habits and constraints, it will not work. Simple as that. And this is not just a story about emerging markets. Expectations are shifting everywhere. From Nairobi to New York, younger generations want the same thing: speed, clarity, and control. No paperwork, no delays. No waiting in line or sitting on hold. Inclusion and convenience are no longer perks. They are the baseline — the minimum customers expect in a modern experience. Better Payments Without Core Replacement Here is the best part: you do not need to tear down your core systems to modernise payments. No massive transformation program or three-year migration. Build on top of what you have. With the right orchestration layer, you can bridge the old and the new — connecting legacy systems with modern infrastructure without disrupting your entire operation. You can capture data from any channel, whether digital or offline, and use it to automate decisions in real-time, factoring in rules, fraud signals, and the specific context of each transaction. Payouts become fast, secure, and traceable — fully digital, and fully aligned with what your customers expect today. And throughout the process, they stay informed. No guessing. No chasing. Modernising payments does not have to mean replacing your core. It just means making your systems work together — and work smarter. Final Thought: Design for Outcomes, Not Applause The best payment tech in insurance is not the one that wins awards.It is the one that quietly improves underwriting performance, accelerates claims, builds customer trust, and gives you tighter control over your business. Everything else is just theatre. Are your payments still just plumbing?Or are they your next power move?