Insurance Software: Automating Claims and Policies

In today’s rapidly evolving insurance landscape, companies are under immense pressure to enhance operational efficiency while delivering fast, accurate, and transparent services. Traditional, manual approaches to claims processing and policy management are no longer sufficient. Customers demand speed, convenience, and precision, while insurers need to reduce operational costs and improve compliance. This is where insurance software for automating claims and policies comes into play.

From AI-driven claims assessments to policy administration systems and fraud detection mechanisms, automation is transforming how insurers operate. In this article, we will explore the full spectrum of insurance software, cover real-world examples, highlight emerging technologies, and provide actionable insights—all backed by recent industry data and competitor analysis.

Imagine submitting a claim and waiting weeks for a response, or spending hours navigating complex policy documents. Frustrating, right? According to recent industry research:

• 21% of insurance customers expect claims to be settled within hours.
• 43% of customers wait more than two weeks for resolution, with a third waiting 2–4 weeks or more.

Manual processes are slow, error-prone, and costly. Automation not only speeds up claims processing but also reduces errors, enhances customer experience, and ensures beyond compliance.

• $45.7 billion: Projected global spend on claims-processing software in 2025, up from $42 billion in 2024, reflecting double-digit growth as insurers digitize operations.
• 10x faster: FlowForma’s claims processing speed compared to traditional tools, demonstrating AI-driven efficiency improvements.
• 60% real-time claim settlement: Achieved by Sprout.ai, highlighting automation’s impact on customer experience.
• 21% vs. 43%: Only 21% of customers expect claims settled within hours, while 43% currently wait over two weeks, emphasizing the gap automation fills.
• 62% retention: Customers remain with insurers after a positive automated claims experience, versus 19% after a poor experience.
• 10% fraud rate: Approximate percentage of property and casualty claims that are fraudulent, underscoring the importance of AI-powered fraud detection.

Insurance software for automating claims and policies is much more than a fancy tool—it’s the engine that powers modern insurance operations. At its core, it’s a digital platform that manages everything from filing claims and approving payouts to updating policies and detecting fraud. By automating repetitive, time-consuming tasks, insurers can focus on what really matters: delivering faster, more accurate, and customer-friendly services.

Think of it like upgrading from a horse-drawn carriage to a high-speed train. The destination—handling claims and policies—is the same, but the speed, precision, and experience have improved dramatically. Platforms like FlowForma, Sprout.ai, and Openkoda demonstrate how automation transforms claims management, with capabilities such as 10x faster processing or 60% of claims settled in real time.

Why Automation Matters in Insurance

The insurance landscape has changed. Customers are no longer patient. In fact, 21% of customers expect claims to be settled within hours, yet nearly 43% wait two weeks or more. Meanwhile, younger generations—40% of 18–24-year-olds and 37% of 25–34-year-olds—prefer insurers that leverage AI-assisted processing. These statistics underscore why automation isn’t just a luxury—it’s a necessity.

Automation offers a solution to several long-standing problems:

• Speed & Efficiency: Automated workflows eliminate bottlenecks, allowing claims to be processed in hours rather than weeks.
• Accuracy & Compliance: With AI and structured workflows, human errors drop, policy data stays consistent, and regulatory requirements are easier to meet.
• Customer Satisfaction: Fast, transparent processing builds trust. In fact, 62% of customers stay with an insurer after a positive claims experience, while only 19% remain after a negative one.
• Cost Reduction: Automating repetitive tasks reduces staffing costs and frees employees for higher-value work.

Essentially, automation turns a reactive insurance process into a proactive, customer-centric operation.

Context: The Industry Shift Toward Automation

The global market clearly reflects this trend. Spending on claims-processing software is projected to rise from $42 billion in 2024 to $45.7 billion in 2025, with insurers increasingly investing in AI, RPA, and digital policy management solutions. This shift is not just about technology—it’s about business survival and competitiveness. Insurers adopting automation see faster turnaround times, higher customer retention, and a stronger bottom line.

Prerequisites for Implementing Insurance Automation

Before jumping into automation, insurers must prepare the ground. The prerequisites go beyond simply installing software:

• Reliable Digital Infrastructure:Cloud-based systems and secure data storage are essential for handling sensitive customer information.
• Clean, Structured Data: AI-driven automation only works effectively if the data is accurate, standardized, and accessible.
• Integration Capabilities: Automated systems need to work seamlessly with existing policy administration systems, CRMs, and fraud detection engines.
• Employee Training: Staff need to understand the new workflows and learn how to interact with AI-driven tools.

In short, insurance automation is not just a software upgrade—it’s a strategic initiative. Companies that plan ahead, prepare their data, and train their teams are the ones that reap the greatest rewards.

Insurance software serves as the backbone of modern insurance operations. It is designed to automate the entire lifecycle of claims and policies while providing actionable insights, data analytics, and improved customer service.

What Is Insurance Software?

Insurance software includes systems that manage:

• Claims processing
• Policy administration
• Fraud detection
• Customer engagement

It ensures data accuracy, reduces human error, and provides real-time insights to help insurers make smarter business decisions.

Types of Insurance Software

Insurance software solutions can be divided into two primary categories:

Claims Management Systems (CMS)

Claims management systems streamline the entire claims lifecycle:

• Intake and verification
• Damage assessment
• Fraud detection
• Approval and payout

Notable Examples and Data:

• FlowForma: Offers 10x faster claims processing than other platforms.
• Sprout.ai: Can settle over 60% of claims in real time.
• Openkoda: Reports a 60% reduction in delivery time versus green-field custom builds.

Policy Administration Systems (PAS)

Policy administration systems manage the end-to-end policy lifecycle, including issuance, endorsements, renewals, and cancellations.

• NowCerts: Offers cost-effective plans starting at $99/month for a single user, scaling to $349/month for five users, with $45 for each additional user.

Manual insurance operations face multiple hurdles that impact efficiency and customer satisfaction.

Manual Claims Handling

Processing claims manually requires human intervention at every step. Staff must verify documents, contact multiple parties, and ensure compliance with regulations. This often results in delays and customer dissatisfaction.

Complex Policy Management

Managing policies with multiple riders, clauses, and conditions manually increases the risk of errors and missed deadlines.

Data Inconsistencies and Errors

Without automation, insurers struggle with duplicated records, outdated information, and inconsistencies that can compromise decision-making.

Automation transforms insurance operations by streamlining processes, reducing errors, and improving customer experiences.

Streamlined Claims Processing

Automated claims workflows leverage AI and machine learning to:

• Fast-track 90% of “good” claims for quick settlement
• Flag fraudulent claims (approximately 10% of property and casualty claims are fraudulent)
• Provide “white-glove” treatment for high-value or complex claims

Efficient Policy Management

Digital PAS ensures policies are updated in real-time. Automated renewals and self-service portals provide customers with easy access to their documents, improving satisfaction.

Real-Time Data and Analytics

Automation tools capture and analyze data continuously, offering insights into:

• Claims trends
• Risk patterns
• Customer behavior

This enables better underwriting decisions and operational planning.

AI-Powered Claims Assessment

Artificial intelligence evaluates claim documents, predicts outcomes, and detects fraudulent activity, reducing manual workload and improving accuracy.

Digital Policy Lifecycle Management

Automated PAS handles all policy steps from issuance to renewal. Alerts prevent policy lapses, while centralized data ensures consistency.

Fraud Detection Mechanisms

Advanced algorithms monitor anomalies in claims, protecting insurers from fraud while maintaining a smooth experience for genuine claims.

Customer Self-Service Portals

Portals allow customers to:

• Check policy status
• File claims
• Download documents

Customer Preference Data:

• 40% of 18–24-year-olds and 37% of 25–34-year-olds prefer insurers with AI-assisted processing.

Faster Claim Settlements

Automation reduces processing times from weeks to hours, meeting customer expectations and improving retention.

Reduced Operational Costs

By reducing manual labor and paper processes, automation significantly cuts costs while improving efficiency.

Improved Customer Satisfaction

A positive claims experience drives loyalty:

• 62% of customers remain after a good experience
• Only 19% remain after a poor experience

Regulatory Compliance Made Easier

Automation ensures all claims and policies adhere to regulations, reducing audit risks and potential fines.

Choosing the Right Software

Select software based on:

• Company size and needs
• Scalability
• Integration capabilities

Integration with Existing Systems

Most platforms integrate with:

• Policy administration systems
• CRM systems
• Fraud detection engines

Low-code or no-codesolutions allow business users to automate without developer support.

Training and Change Management

Effective employee training and change management strategies are critical for successful adoption.

AI and Machine Learning

AI is enhancing:

• Claims assessment
• Risk evaluation
• Personalized policy recommendations

Robotic Process Automation (RPA)

RPA automates repetitive, rule-based tasks, freeing employees for more complex activities.

Blockchain for Insurance

Blockchain ensures secure, transparent, and tamper-proof policy and claims records, improving trust and efficiency.

Modern insurance platforms are increasingly adopting AI indexing, semantic search, and structured data strategies—similar to those used in content SEO for AI. Competitors like Search Engine Journal, Search Engine Land, and Google Cloud Vertex AI emphasize:

• Structured data & Schema.org for AI-friendly indexing
• Chunking and embeddings for LLM-ready data
• Hybrid rendering & semantic markup for dynamic content

In insurance software, this translates to:

• AI-driven claims triage
• Data embeddings for historical claim analysis
• NLP-powered insights for underwriting

Platforms like AWS Bedrock leverage Generative AI and LLMs to automate claims while ensuring data privacy and security.

Company A: Faster Claim Processing

By adopting AI-driven software, Company A reduced claim processing times by 50%, improving customer retention and operational efficiency.

Company B: Policy Management Efficiency

Company B implemented automated PAS to track policies accurately, streamline renewals, and reduce errors.

Understanding the benefits and performance of insurance software for automating claims and policies requires a structured approach. Here’s how we gathered, verified, and analyzed the information in this article:

Sources

We relied on a combination of industry reports, competitor blogs, and authoritative research. Key sources include:

• Industry Reports: Deloitte, McKinsey & Company, and IDC reports on AI adoption and insurance software trends.
• Competitor Insights: Hicron Software, VCA Software, MoldStud, FlowForma, AWS Bedrock, Decerto, and Salesforce blogs provided real-world implementation data and feature analysis.
• Market Data: Global claims-processing software spend, customer retention, and satisfaction statistics from 2024–2025.

Research Methods

• Data Compilation: Collected numerical data points such as claims processing speed, customer retention percentages, and software pricing.
• Comparative Analysis: Compared leading software platforms across claims efficiency, AI capabilities, fraud detection, policy management, cost, and integration.
• Trend Identification: Analyzed AI, RPA, blockchain, and LLM adoption trends in insurance automation.
• Cross-Verification: Checked competitor claims against multiple sources to ensure accuracy and reliability.

Tools Used

• Content Analysis: Reviewed competitor blogs and structured content to identify focus areas, features, and claimed benefits.
• Data Visualization Tools: Tables, charts, and highlight boxes to present comparisons and key metrics.
• SEO Analysis: Ensured headings, keyword usage, and structure align with modern AI-driven search standards.

Limitations

• Proprietary Data: Some company-specific performance metrics and pricing may vary and are based on publicly available information.
• Rapidly Evolving Technology: AI and insurance automation software evolve quickly, so certain capabilities may improve or expand after publication.
• Regional Differences: Insurance regulations, software adoption rates, and customer expectations can differ by region.

Firsthand Expertise

• Insights are enriched with practical experience from analyzing software functionality, workflow automation, and AI integration in insurance systems.
• Knowledge of industry best practices, common implementation challenges, and emerging trends in automation ensures the content is actionable and realistic.

Insurance software that automates claims and policies is a game-changer. It enhances operational efficiency, reduces errors, cuts costs, improves customer satisfaction, and ensures compliance. By adopting AI, RPA, blockchain web3, and structured data strategies, insurers can stay ahead in a competitive landscape. Automation is no longer optional—it’s essential for survival and growth.

• Hicron Software – “Insurance Claims Automation Explained: Efficiency Meets Innovation” (2025)
• VCA Software – “Insurance Claims Automation: Process, Tools & VCA Software” (2025)
• MoldStud – “Automating Claims Processing with Insurance Claim Software” (2025)
• FlowForma – “Top 10 Best Insurance Claims Processing Software in 2025” (2025)
• AWS – “Automated Insurance Claims Processing using Amazon Bedrock, Knowledge Base, and Agents” (2025)