Article Summary
Insurance companies are under increasing pressure to process claims faster as 83 percent of policyholders would switch insurers after a negative claims experience, with payment speed being the top consumer frustration despite actual processing times stretching beyond six weeks when customers expect payments within five days.
- 83 percent of policyholders would consider leaving their insurer following a negative claims experience
- Customers expect payments within five days, but actual processing frequently takes more than six weeks
- 40 percent of consumers cite payment speed as the top aspect of claims handling they want improved
- Canadian insured losses from catastrophic weather reached record $8.5 billion in 2024 with over 273,000 claims filed
- 58 percent of policyholders prefer direct bank deposits for claims payments, with digital channels dominating payment preferences
Toronto, Ontario -- A new survey suggests auto insurers are facing pressure to settle claims more quickly, as prolonged payment timelines threaten customer loyalty in an industry grappling with an unprecedented surge in catastrophic weather events.
Research from InvoiceCloud's 2025 Consumer Claims Experiences Survey indicates that 83 percent of policyholders would consider leaving their insurer following a negative claims experience. The study, which polled 1,000 American adults through research firm Dynata, found that payment speed topped the list of consumer frustrations, with 40 percent naming it as the aspect of claims handling they would most like to see improved—outpacing concerns about inconsistent communication, cited by 29 percent of respondents.
The disconnect between policyholder expectations and industry performance is stark. External industry data shows 82 percent of customers anticipate receiving payments within five days, yet actual processing times frequently stretch beyond six weeks. Among survey participants who had filed claims, 27 percent waited more than seven days for payment, while just 10 percent received funds within the first 48 hours. Additionally, 22 percent of respondents reported experiencing payment delays.
The implications are particularly relevant for collision repair facilities. Vehicle collision claims represented the leading category among survey respondents who had filed property and casualty insurance claims, accounting for 24 percent of all filings. Weather-related damages from wind and hail tied with water damage at 16 percent each.
The timing is significant given the dramatic rise in catastrophic weather events affecting North American repair operations. Canadian insured losses from catastrophic weather events totaled a record-breaking $8.5 billion in 2024, with more than 273,000 claims filed—far exceeding the previous record of 197,000 set in 2016.
Last summer's severe weather events in Canada resulted in 228,000 claims in just two months, a 406 percent increase compared to the previous 20-year average.
These claim surges place additional strain on an industry already struggling with payment timelines. Insurance payment delays extending to 60 or 90 days instead of the expected 30-day window have left some repair facility owners struggling to make payroll while waiting for reimbursement.
Sarah Woodard, who oversees insurance product management at InvoiceCloud, emphasized the reputational stakes. "In moments of crisis, timing is everything, and supporting policyholders in critical moments defines an insurer's reputation," she stated, noting the importance of speed and clarity in claims disbursements.
Payment method preferences skew heavily toward digital channels. Direct bank deposits appeal to 58 percent of respondents, while paper checks retain favor with 20 percent. Digital payment platforms like Venmo and PayPal attract seven percent of consumers surveyed, with the majority of that segment being Gen Z respondents. When emergency access to money is needed, 49 percent of respondents identified online banking as their go-to solution, followed by bank withdrawals at 20 percent, keeping cash at home at 15 percent, and digital wallets at 13 percent.
For claims-related updates, consumers still favor phone contact, chosen by 48 percent of survey participants. Email ranked second at 33 percent, while text messaging garnered 13 percent and app notifications four percent. Paper mail registered minimal appeal, selected by just two percent of respondents.
The survey findings arrive as Canadian insurers face historic rates of customer switching.
Meanwhile, customer satisfaction research from Ipsos shows the industry still scoring in negative territory despite recent improvements, underscoring the continued need to strengthen customer relationships.
