Insurance Claims Processing Software

The Insurance Claims Processing Software industry has transformed insurance claims handling, previously a labor-intensive process, over the past decade. Industry operators market their products, which are used to process insurance claims and manage policies, primarily to the Property, Casualty, and Direct Insurance industry and the Life Insurance and Annuities industry.

Property and casualty (P&C) insurers and life insurers seek to differentiate themselves in their competitive environments by using industry products, which are designed to streamline operations, reduce process complexity and costs, manage compliance with new regulations and increase customer satisfaction.

Therefore, industry revenue has declined an annualized 0.4% to $9.3 billion over the five years to 2020, including a decline of 16.7% in 2020 alone due to the increased economic and financial uncertainty amid the COVID-19 (coronavirus) pandemic. Profit is anticipated to decline during the period as well.

Developing and selling software that is used to process insurance claims and manage policies, the Insurance Claims Processing Software industry is heavily reliant on demand for property, casualty, direct, and life insurance.

The industry’s downstream demand is directly affected by the number of motor vehicle registrations, homeownership rate, and yield on the 10-year Treasury note, as well as per capita disposable income and employment numbers.

Additionally, industry operators benefit from general trends affecting the Software Publishing industry, such as digitalization and productivity enhancement.

Over the five years to 2020, old and widespread technology, lack of analytics and collaboration, increasing regulation and rising customer expectations have stimulated industry revenue growth.

However, the economic uncertainty fueled by the COVID-19 (coronavirus) pandemic is expected to result in declining demand for industry services, leading to decreasing industry revenue in 2020.

Overall, industry revenue has fallen at an annualized rate of 0.4% to $9.3 billion over the five years to 2020, including a decline of 16.7% in 2020 alone.

Over the five years to 2025, the Insurance Claims Processing Software industry is expected to rebound as the COVID-19 (coronavirus) pandemic subsides and the associated recession gives way to economic recovery.

As this economic recovery continues, progress for the industry will likely be defined by the development and refining of predictive analysis and supported by resurgent growth of the Property, Casualty, and Direct Insurance industry and Life Insurance and Annuities industry. As insurance companies focus their efforts on enhancing customer experience and managing risk optimally, industry operators are expected to do the same.

Software publishers are also anticipating an accelerated move toward cloud computing, whereby storage and computing tasks are handled by networked machines, often servers in a data center owned by the service provider. Thus, revenue is expected to increase at an annualized rate of 7.6% to $13.4 billion over the five years to 2025.

All claim-related data and documents are stored in claims management software. Correspondence notes, tasks, assignments, and other pertinent information, such as initial notification of loss and document file activity, may all be kept in one place.

Claims management software may either allocate work to claims experts automatically or allow many people to work on the same claim at the same time since everyone participating in the process can see the same information.

In 2020, revenue from claims management software is estimated to account for 34.6 percent of total industry revenue.