Insurance in Australia and New Zealand is being reshaped by rising claims costs, digital expectations, evolving payments technology, and the ongoing cost pressures faced by consumers and businesses alike. These factors are influencing how best-practice insurers are now collecting premiums and paying claims, with implications for conversion, retention, and customer satisfaction.

Across the ANZ insurance industry, five key payment trends are becoming especially prominent.

1. Reducing missed payments is driving smarter recovery strategies

Missed payments are a major driver of policy lapses. When customers don’t update expired cards or have insufficient funds on payment dates, their insurance coverage can inadvertently stop. 

Insurers in ANZ are investing in smarter payment-failure strategies to go beyond simple reminders. These include multiple retry attempts, proactive prompts to update payment details, and offering customers flexible options to pay outstanding balances. The aim is to protect the continuity of their coverage and avoid the administrative costs of reinstatements, while enhancing customer experience.

This shift aligns with broader industry thinking; many insurance providers globally are now treating payments performance as a direct contributor to retention and loyalty. This is because automatic payment updates and retry logic help reduce involuntary churn. 

2. Account-to-account payments are emerging alternatives to cards 

While debit and credit cards are still a dominant payment method for many policyholders, alternatives like account-to-account (A2A) payments and real-time bank transfers are gaining traction.

In Australia, PayTo is changing how A2A payments are used for pre-authorised transactions. Built on the New Payments Platform, PayTo is a secure payment method that allows customers to pay from their bank account using their PayID, giving them more visibility and control than traditional bank transfers.

This makes it well-suited to insurance use cases, such as upfront premium and renewal policy payments, where trust and transparency are critical. Customers have a clear view of how much money is being debited from their accounts, allowing them to easily manage transactions in real time.

For insurers, these developments make A2A payments increasingly attractive. When integrated well, they offer lower processing costs, faster settlement and fewer disputes, while meeting rising customer expectations around control and clarity.

3. Direct debit is being redesigned around customer control

Direct debit continues to be a foundational payment method for recurring premiums in ANZ. Australia and New Zealand have both traditionally relied on Bulk Electronic Clearing System (BECS) batch processing for direct debit and credit management. Though these systems are familiar and widely adopted, they are slower and more manual.

Insurers and customers are now demanding more transparency and flexibility around mandates. Traditional direct debit processes can be relatively opaque, leading to confusion when payments fail or details change. When such issues arise, notifications can be delayed, resulting in missed payments and policy lapses. For insurers, this lack of transparency drives higher contact centre volumes and slower recovery when payments fail.

As a result, insurers in ANZ are modernising how recurring payments are set up and managed. In Australia, PayTo is enabling customers to approve and manage ongoing payments directly within their banking app, while in New Zealand, insurers are layering digital mandate management and preparing for near real-time payments as infrastructure evolves.

This transition will enable insurers to improve reconciliation and reduce settlement delays, particularly for high-value premiums and time-sensitive transactions.

4. Faster claims payouts are becoming a competitive edge

While premium collection remains important, there’s no denying that claims disbursements are where policyholders feel the real value of insurance lies.

Insurers in Australia, for instance, are dealing with increasing claim costs and volumes, driven by climate volatility and weather damage. In 2023-2024, insurers incurred $2.19 billion in claims from natural catastrophes.  

Against this backdrop, insurance companies are exploring faster payout methods and clearer communication about timing and disbursements. Whether it’s paying directly to account, card or wallets, the trend is moving toward faster access to funds at critical moments, without sacrificing fraud controls.

5. Payments are becoming more closely tied to customer outcomes

Rather than looking at payments in isolation, insurers are increasingly measuring them against broader business goals.

Teams are now asking questions, such as:


Do customers abandon quotes because payments are too complicated?
How many policies lapsed and renewals are lost due to avoidable payment failures?
How much of the contact centre volume is driven by payment confusion?
How resilient is our payments infrastructure during peak events?

This has led to a greater focus on orchestration and lifecycle design. Clearer customer experiences, simpler payment journeys, and more transparent communication are all part of this evolution.

A lifecycle view is shaping the next phase of insurance in ANZ

In a market defined by volatility and high customer expectations, small improvements in payment experiences can deliver meaningful gains in efficiency, trust and retention.

Across ANZ, insurance providers are seeing the strongest results when taking a full lifecycle view of payments:


Quotation: Remove friction and build confidence
Onboarding: Set up accounts and payments seamlessly
Policy management: Make changes to coverage easily and prevent payment failures
Claims: Deliver fast and reliable payouts
Renewal: Protect the continuity of insurance cover

Find out more: Getting payments right: Insurance | Worldpay