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U.S. insurance carriers are turning to business process outsourcing (BPO) providers to help them navigate a new way of doing business and meet rising customer expectations stemming from the COVID-19 pandemic, according to a new report from Information Services Group (ISG, Stamford, Conn.), a global technology research and advisory firm.
The 2021 ISG Provider Lens Insurance BPO Services Report for the U.S. finds that insurance carriers in the country are looking for provider expertise to supplement their in-house talent after large employee turnover during the pandemic.
Insurance BPO providers offer technologies that help insurance carriers automate processes and reduce manual handling of insurance processes, allowing carriers to reduce employee headcount in some areas, the report says. Carriers also are looking to BPO providers to help them build and grow their online sales channels, cut costs and optimize processes.
“During the pandemic, insurance carriers needed to be able to sell remotely with mobile applications that deliver a first-class customer experience,” comments Paul Schreiner, partner and insurance industry lead for ISG Americas. “Carriers that were far along in their digital transformation efforts before the pandemic were able to shift easily to remote work models because they could offer customers and employees tools and technologies that automated many processes.”
The report sees many insurance carriers in the U.S. still dealing with pre-pandemic issues like legacy technology system constraints while they market their services to an increasingly tech-savvy customer base. Carriers also are facing increasing competition from traditional and new competitors, such as Insurtechs, as well as cybersecurity concerns and data handling challenges.
To meet their growth and innovation goals, many carriers are looking to BPO service providers to help them bring new customer-facing technologies to market, the report adds.
Carriers in the U.S. are also engaging BPO providers and third-party administrators (TPAs) to provide sophisticated analysis tools, the report says. Many providers now offer data analytics and data management capabilities that help carriers make sense of their data and glean insights to inform strategic business decisions.
In addition, U.S. carriers are looking to BPO providers and TPAs to help them contain costs and optimize efficiencies across their businesses, the report adds. Automating parts of the underwriting process can, for example, free trained staff from performing redundant and manual tasks.
Finally, the report notes, many carriers see engaging with BPO providers and TPAs as a key to improving customer experience. BPO providers and TPAs can help carriers create personalized services, facilitate processes from applications through claims, and create omnichannel communications with policyholders.
The 2021 ISG Provider Lens Insurance BPO Services Report for the U.S. evaluates the capabilities of 34 providers across three quadrants: Life and Retirement Services, Property and Casualty Services and Life and Retirement TPA Services. The report names Accenture, Cognizant, DXC Technology, EXL, Infosys and WNS as Leaders in all three quadrants. Genpact and TCS are named Leaders in two quadrants, and NTT DATA, ReSourcePro and SE2 are named Leaders in one quadrant.
In addition, Genpact, Illumifin and Teleperformance were named Rising Stars—companies with “promising portfolios” and “high future potential” by ISG’s definition—in one quadrant.
A customized version of the report is available from WNS.