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December 13, 2022

How Insurance Verification Software Helps Businesses


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Insurance is required for many business transactions depending on the industry and services needed. However, adequate insurance can be expensive, and the policies are often confusing. As a result, it's common for individuals to provide incorrect information about their coverage.

Unfortunately, this can mean participating in fraudulent activities that result in considerable business costs in the form of denied claims. Sometimes, individuals claim they have insurance for certain services or activities beyond their actual coverage.

More commonly, consumers don't understand all the insurance coverage details. So, how can businesses protect themselves against claims denials that come with false filing? Insurance verification is the only way.

What Does Insurance Verification Mean?

Insurance verification confirms an individual's or business's insurance coverage before an encounter or transaction occurs. The practice's most well-known usage is verifying eligibility for healthcare services by contacting a patient's insurance company to confirm coverage.

However, insurance verification is used in other industries as well. For example, proof of insurance is required to secure a home mortgage loan, when you transfer the title of a vehicle, and to provide certain services as a contractor.

What Is Insurance Verification Software, and Why Does Your Business Need It?

If your business utilizes payments from insurance companies, you need an effective insurance verification system. In today's business world, transactions must happen in real-time to maintain high production.

Yet, if you assume a customer's or patient's insurance details are correct, you take on substantial risks. In the event of a denied claim, you might not get paid. In some situations, you can even be held liable for the results of inadequate insurance coverage simply because you approved the transaction.

Insurance verification software is an application or platform that allows you to verify insurance details in real-time with just a few clicks. The software is typically downloaded by your company or installed by the provider. Often, insurance verification software can be integrated with billing software to provide a seamless process for administrators.

What Methods Could be Used to Verify Insurance Benefits?

Verification involves collecting extensive details from an insurance company about an individual's benefits. The information must include coverage percentages, deductibles, maximums, and limitations.

To access this information, you must contact the insurance company or utilize tools to access information from the insured's policy. This can be achieved in a few different ways:

  • Direct communication with the insurance company: This approach generally requires verifying insurance before services. The insured provides specific information about their insurance policy, and a business confirms eligibility through communications with the insurance company.
  • Outsourcing insurance verification services: This approach takes insurance verification out of your hands and allows you to depend on a third-party company to verify insurance claims and share proof of coverage. The time required to get a verification may vary depending on your service provider.
  • Using insurance verification software: This option allows you to keep insurance verification in-house and provide instant verification of benefits. Insurance verification software can eliminate manual tasks and help businesses save time.

Manual vs Automated

In the past, all insurance verifications were completed manually creating a tedious process that requires the verification specialist to spend hours with insurance companies to gather detailed information.

Any errors in the information provided by the insured, manual data entry, or a misunderstanding with the insurance company can delay the process even further. As a result, it was fairly common to perform services even if insurance was not properly verified.

Automated services provided using modern technology improves the insurance verification process considerably. Eligibility verification software is typically integrated with the billing system of a business and many insurance providers. As such, a business can quickly access relevant information to verify insurance coverage.

What to Look for in Insurance Eligibility Verification Software

Instead of purchasing coverage based on needs, it's common for individuals to buy insurance based on state or employer requirements. While purchasing minimum requirements helps the individual avoid fines and penalties, it can lead to limited knowledge about the coverage provided by a policy.

Intelligent software designed for insurance verification can give a business access to the insured's information. When choosing a system for insurance eligibility verification, it's important to ensure it has these core capabilities.

Integration Capabiliites

Whether insurance verification software is used by a business or insurance company, it's likely the company utilizes various software, platforms, and applications to perform daily tasks. When the systems used within a business don't communicate properly, errors can occur, and more manual tasks are required of staff members. The insurance verification system you choose should be able to integrate with related systems for smooth workflows.

Real-Time Verification

Choosing a system that provides real-time verification as soon as the insured's details are entered into the system is vital. This feature lets your business verify coverage and benefits in minutes to avoid service delays.

Error Scrubbing

Since human error is inevitable, it's important to choose a verification system that can identify missing information or documentation errors and fix any mistakes that have occurred. By ensuring claims are accurate, businesses can reduce denials.


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What Are the Benefits of Using Software to Verify Insurance?

Insurance verification software allows a company or medical facility to keep insurance verifications in-house without the time-consuming manual processes typically associated with the process. The software can help businesses reduce clerical errors and provide valuable benefits.

Fewer Denied Claims

When insurance is verified before services are provided, a business can avoid providing services not covered by an insurance plan until other payment plans are finalized. By reducing denied claims, businesses can improve efficiency and avoid financial losses.

Maximize Staff Efficiency

Manual insurance verification procedures are time-consuming. Often, staff members responsible for this chore spend much of their day on the phone, waiting to speak with insurance agents or making multiple points of contact to gather all details necessary for verification. Insurance verification software completes the process immediately and eliminates manual data entry requirements.

Increase Customer Satisfaction

Consumers and insurance clients expect the businesses they depend on to utilize modern technology for convenient services. Insurance coverage is complex, and many people are unaware of what their policy actually covers. When you have the tools to immediately explain coverage limitations, you provide customers with better service.

How Does Insurance Verification Software Work?

Insurance verification software is a tool that allows businesses to connect efficiently with insurance providers to access information about an individual's coverage allowing that business to better perform. It is designed to determine whether a specific service is covered before services are rendered.

Insurance verification software is connected to several insurance providers to collect consumer  information. The process begins when a user enters patient or customer information into the system.

The software uses the customer's personal and insurance information to identify the policy and collect relevant information, including whether the policy is active, any policy limitations, coverages, premiums, deductibles, and whether pre-authorization is required. These details clarify whether the policy covers specific services.

Use Cases and Examples of Insurance Verification Software

Insurance verification software is most frequently used in healthcare to confirm patient eligibility for specific services, but more business that require insurance verification are beginning to take advantage as well. Such systems help businesses verify insurance, avoid claims denials, and improve consumer  satisfaction.

However, there are also other instances in which insurance coverage may need to be verified. These are some of the ways insurance verification software is used.

Healthcare Services

Denied claims in the healthcare industry are extremely common. Due to the intricate nature of health insurance policies, it's difficult for patients to understand what services are covered by the policy.

When deductibles and pre-authorization requirements are added to the mix, it's challenging to understand coverage limitations. With insurance verification software, medical facilities can verify a patient's insurance coverage before services are rendered to determine how the services will be paid for.

Prove Required Auto Coverage

Most states require drivers to carry a certain amount of auto insurance. As such, drivers are generally required to provide proof of insurance during a title change or if a law officer pulls them over. Many states use an electronic insurance verification system to immediately identify uninsured drivers after an accident or during a traffic stop.

When applying for a new auto insurance policy, drivers must provide proof of current coverage because a lapse presents a higher risk. In this situation, an insurer may have tools to gather information about the driver's existing policy. For example,InsurGrid allows an insurance agent to gather a client's insurance policy data in seconds to get all the details about their existing coverage.

Reducing Insurance Risks in Construction

Construction businesses are responsible for managing insurance compliance. This means ensuring all subcontractors have the required insurance coverage to perform required tasks.

While a company might track how many contractors have COIs (certificate of insurance), it can be challenging to see if all requested coverage types are present. With automated insurance verification software, construction companies can ensure that contractors have active and up-to-date policies that eliminate exceptions and gaps in coverage.

Modern Technology Eliminates the Pain Points of Insurance Verification

Businesses and insurance companies are responsible for communicating in ways that help customers and consumers  get the most out of their insurance coverage. Avoiding fraud is a vital priority for both parties. When businesses and insurance brokers can utilize new technology to access in-depth information about a client's insurance data , insurance coverage can be verified before services are rendered to avoid complications after an incident occurs. Learn more about how InsurGrid can help you and get started verifying consumer insurance with an InsurGrid Sales Demo.