Insurers Seek Help from Outsourcing Providers to Keep Up with Changing Market

Traditional insurance carriers, facing tough regulatory requirements, a growing flood of data and competition from a new breed of digital-first insurance vendors, want technology service providers to help them address these market challenges, according to a new report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2021 ISG Provider Lens Insurance BPO Services and TPAs Archetype Report finds insurers across the globe encountering increasingly demanding customers who expect a great experience with every interaction. Insurers, as a result, are turning to technology outsourcing providers to help them better meet their business objectives, increase operational efficiency, and improve the customer experience across all interactions.

“Insurance customers are increasingly tech savvy and comfortable with online purchases and communications with their insurance carriers,” said Paul Schreiner, partner and leader of the ISG Insurance vertical in the Americas. “Customers today expect all interactions with their insurers to be frictionless, efficient and positive.”

Many insurance-focused business process outsourcing (BPO) providers and third-party administrators (TPAs) offer a variety of technologies that can help insurers streamline customer-facing processes and provide better experiences across contact channels, the report says. Many of these providers can digitize processes across the policy lifecycle, including onboarding and claims. This helps traditional insurance carriers keep up with new InsurTech challengers.

Insurance companies also look to BPO providers and TPAs to help them grow market share, boost revenue, and expand their footprints, the report says. Providers can help insurers get products to market quickly, explore new markets and improve customer experience.

In addition, the report says many BPO providers and TPAs are focused on helping insurers protect customer data. Insurers deal with highly sensitive personal data, and a single breach can cause long-lasting damage to a carrier’s brand and bottom line. Many BPO providers and TPAs offer security capabilities that exceed data protection mandates and regulations.

The report also sees insurance carriers embracing robotic process automation, artificial intelligence and the cloud to boost productivity, create process efficiencies and lower costs. The cloud allows insurance carriers to test and implement new business models and technologies.