Claims as a service: How Insurtech is turning the moment of truth into a moment of trust
- Jun 8
- 6 min read
Article Summary
This article by Saurabh Tiwari, CTO, Policybazaar, examines how InsurTech is redefining the insurance claims process as a seamless, consumer-first service experience. The author argues that claims - not premiums or policy documents - represent the true test of insurance's promise to consumers. AI-powered fraud detection has delivered a 14x improvement in the Early Claims Factor in life insurance since 2022. Readers will understand how technology is turning opaque claims processes into guided journeys while creating a data feedback loop that continuously refines products and builds lasting consumer trust.
Claims as a service: How Insurtech is turning the moment of truth into a moment of trust
Policy, premium, sum insured - these are some of the most commonly used terms in our insurance industry. But if you ask a consumer, they don't really mean anything unless they come to their rescue when they need it the most. Precisely, it's the moment when they file a claim. And claims are preceded by moments no one wants to be in. It could be a sudden hospitalisation, an accident or worse, an untimely loss of life. These are the moments that put insurance to test, and the consumer only wants the promise to come through.
Much like SaaS (software as a service), claims as a service is how consumers perceive their insurance to be. They don't want to think about the architecture or infrastructure behind a product, they simply want it to work. Insurance is now being held to that same standard. When consumers set aside a portion of their income towards a policy, what they are really buying is not a document or a benefit structure, but the assurance that, in a moment they never planned for, their financial security will be preserved. In that sense, the claims experience is no longer just an outcome, it is the service itself.
The interface that makes the promise real
Before insurance can deliver on this expectation, there needs to be an interface that can intercept the complexity of this sector and produce clarity for the consumer. A claim essentially means a chain of verifications, approvals and settlements that must tie together seamlessly. Without the right technological layer, this chain often breaks into fragments. What follows is a broken consumer experience in the form of delays, rejections or disputes. To truly function as a service, claims need to be orchestrated through systems that are intuitive on the surface and integrated deeply beneath. The system that connects insurers, hospitals, consumers and databases in real time.
This is where Insurtech steps in. Often perceived as a point or channel of sale, Insurtech actually doesn't work on the sidelines. It acts as the enabler at every touchpoint by building the tech that brings the ecosystem together. APIs, AI-led engines, real-time data exchanges - insurtechs are compressing what used to take days into minutes. This makes the whole process and experience a lot more predictable. Whether it is a cashless hospitalisation, an instant motor claim assessment, or simplified documentation in life insurance, technology is turning opaque processes into guided journeys. The shift is subtle but significant: from customers chasing claims to systems anticipating them.
Building trust by addressing last mile concerns
Quite dismally, but insurance had been defined by two fault lines for a long time - fraud and misselling. On one side, insurers built layers of checks to guard against inflated or fraudulent claims. On the other, customers often walked into the claims process with policies they didn't fully understand, sold with gaps that only became visible at the worst possible time. The end result was a trust deficit that kept many from fully buying into insurance in the first place.
For instance, our own data tells us how AI has radically reshaped claims experience. In term insurance, nearly 11% of cases are flagged by AI for potential fraud. In investment plans, the number is close to 16%. This early flagging has led to a 14x improvement in the Early Claims Factor since 2022 in Life Insurance.
While technology is one part of the puzzle, the real difference is holding the consumer's hand at the time of need. Dedicated support teams at hospitals are helping customers navigate cashless treatments in real time. Claims assistance teams are stepping in to guide families through term insurance processes during moments of loss. In motor insurance, deeply networked garages, even in smaller towns, are enabling faster repairs and approvals without back and forth.
Insurtech is helping address both ends of the problem simultaneously. Smarter data systems and AI-led models are making fraud detection more precise, reducing the need for blanket suspicion that slows down genuine claims. At the same time, clearer product design, digital policy journeys, and assisted buying are reducing instances of misselling.
From settlement to signal
The industry must take note that every claim leaves behind a trail of data and decisions that help all of us move forward with better clarity. Today, it is becoming one of the most valuable inputs for what comes next. Claims are starting to inform how products should be designed, priced and even distributed. Patterns emerging from hospitalisations are shaping more relevant health covers. Insights from motor claims are influencing network expansion and service standards. Learnings from term insurance claims are driving simpler documentation and clearer disclosures at the point of sale. In effect, the claims function is feeding back into the system, and tightening it with every iteration.
In fact, to reach deep into India's heartland, Insurtech offers AI powered vernacular languages support. Not just this, now, voice-to-text and screen readers have also helped the visually challenged and elderly navigate insurance journeys more independently. This inclusive design is driving real adoption in Tier 2-3 cities by improving usability and supporting broader goals of financial inclusion.
Taken together, this is what claims-as-a-service looks like in practice. Besides improving experience, we should also be using that experience to continuously refine the promise itself. Over time, this leads to sharper products and stronger trust in them. In an industry often defined by fine print, that ability to listen, adapt, and evolve may well become its most credible differentiator.
Key Takeaways
The claims experience is the true measure of insurance value - consumers purchase not a policy document or benefit structure, but the assurance that their financial security will be preserved in moments they never planned for.
InsurTech acts as an enabler across every claims touchpoint, using APIs, AI-led engines, and real-time data exchanges to compress processes from days to minutes.
AI flags nearly 11% of term insurance cases and approximately 16% of investment plan cases for potential fraud, enabling precise detection without slowing genuine claims.
AI-powered fraud detection has delivered a 14x improvement in the Early Claims Factor in life insurance since 2022.
InsurTech's AI-powered vernacular language support, voice-to-text, and screen readers are driving real adoption in Tier 2–3 cities and supporting financial inclusion goals across India.
Frequently Asked Questions
What is 'claims as a service' in insurance?
Claims as a service refers to the consumer expectation that insurance should work seamlessly at the moment of need — much like SaaS software — without visible complexity or friction. The author argues that the claims experience is no longer just an outcome; it is the service itself, requiring systems that connect insurers, hospitals, consumers, and databases in real time to produce clarity from complexity.
How is AI improving fraud detection in insurance claims in India?
AI flags nearly 11% of term insurance cases and approximately 16% of investment plan cases for potential fraud, enabling early and precise detection. This early flagging has contributed to a 14x improvement in the Early Claims Factor in life insurance since 2022, reducing blanket suspicion that previously delayed genuine claims and eroded consumer trust.
How is InsurTech driving financial inclusion through claims technology?
InsurTech platforms offer AI-powered vernacular language support along with voice-to-text and screen reader capabilities, enabling the visually challenged and elderly to navigate insurance journeys more independently. This inclusive design is driving real adoption in Tier 2–3 cities across India, supporting broader financial inclusion goals and expanding insurance access into India's heartland.
Dislaimer: The opinions expressed within this article are the personal opinions of the author. The facts and opinions appearing in the article do not reflect the views of IIA, and IIA does not assume any responsibility or liability for the same.
