Insurance

This guide covers the following:

• An overview of how Insurance providers work.
• An introduction to recurring payments.
• Step-by-step instructions to implement recurring payments in an insurance business.

Overview of Insurance Providers

Insurance companies provide essential coverage and additional services like wellness programs, legal assistance, home maintenance, and roadside support. To offer these services, they often partner with third-party providers and set pricing based on factors like policy type and customer usage.

However, both insurers and customers can face challenges when managing recurring payments for these services:

• Missed or Late Payments: Without a reliable system for automatic payments, customers may forget or delay payments, leading to coverage gaps and interruptions in services.
• Administrative Burden: Insurers who manually process recurring payments face time-consuming tasks like tracking and reconciling payments, increasing the risk of errors and inefficiencies.
• Disrupted Cash Flow: Inconsistent payments make it harder for insurers to plan finances and maintain seamless service delivery.

These challenges can impact customer satisfaction and the insurer's ability to deliver consistent, high-quality services. Implementing an efficient recurring payment system can help address these issues and ensure a smoother experience for all parties.

What is Recurring Payment

Recurring payments are automated, repeated transactions that occur at regular intervals (such as daily, weekly, monthly, or yearly) for services or products that continue over time. For example, in an insurance app, recurring payments are used to collect premiums from policyholders on an ongoing basis rather than requiring a lump sum payment upfront.
Key aspects of recurring payments include:

• Automated Billing: Payments are automatically deducted based on the set schedule, reducing the need for manual billing.
• Flexible Intervals: Businesses can set up payments to recur at intervals that match their service and customer requirements, such as monthly or annually.
• Enhanced Customer Retention: Recurring payments simplify the payment process, as customers don’t need to make individual payments for each billing cycle.

How to Integrate Recurring Payment

Before we dive into integrating a recurring charge, let’s consider a scenario:

You are a developer tasked with building an insurance application that allows customers to subscribe to a life insurance plan at a rate of 20,000 NGN per month for a total of 5 months, with payments automatically deducted each month to ensure continuous coverage.

To add recurring payment and support for these features, you’ll do the following:

1. Create a Payment Plan: Create a payment plan by specifying amount name, interval, currency, and duration.

// Install with: npm i flutterwave-node-v3

const Flutterwave = require('flutterwave-node-v3');
const flw = new Flutterwave(
	process.env.FLW_PUBLIC_KEY,
	process.env.FLW_SECRET_KEY
);
const details = {
	amount: 20000,
	name: 'Life Insurance',
	interval: 'monthly',
};
flw.PaymentPlan.create(details).then(console.log).catch(console.log);

You’ll get a response similar to this:

{
	"status": "success",
	"message": "Payment plan created",
	"data": {
		"id": 70176,
		"name": "Life Insurance",
		"amount": "20000",
		"interval": "monthly",
		"duration": "5",
		"status": "active",
		"currency": "NGN",
		"plan_token": "rpp_fa49c8450bf867025d67",
		"created_at": "2024-11-04T10:13:08.000Z"
	}
}

The important value here is the data.id. You’ll use it to create a subscription for the customer and initiate a charge.

2. Add Customer to a Subscription: With the payment plan created, use it to create a subscription for the customer using any of our integration options. For example, use it in Flutterwave inline, as shown below:

<script>
	function makePayment(){' '}
	{FlutterwaveCheckout({
		// other fields ...
		payment_plan: 70176,
	})}
</script>

After the first successful payment, Flutterwave will charge the card subsequently based on the interval set for the payment plan.

Next Step

To learn more about recurring payments and other edge cases you can handle with it, check out the API reference and the documentation.
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