In the insurance industry, the concept of outsourcing was initially met with caution. Major institutions questioned how external service providers could understand the volume and complexity of their business and the culture of their industry. There were also concerns about the retention of control once services had been outsourced. As in other sectors, outsourcing was limited to the provision of relatively unskilled services that were not seen as lying at the core of the business.
Now, however, the insurance industry is a big contributor to the outsourcing boom. In common with other companies, insurers have recognised the potential of outsourcing to:
- renew focus on core strategic work through the transfer of ‘highprocess’ activities;
- reduce IT investment and staff costs;
- increase service efficiency and improve customer satisfaction.
Outsourcing in the insurance sector continues to grow rapidly – in terms of both the number of deals and the types of services outsourced. Insurers now frequently outsource services that are important – essential even – to their businesses. And they have been enthusiastic adopters of offshore outsourcing in the drive to control costs. Some of the main types of business-critical insurance outsourcings are described below. Each of them can be handled from offshore locations offering a round-the-clock, global service.
Call centre outsourcing
Remote call centres are considered to be one of the most successful ways of managing costs. Service providers invest money in infrastructure and stateof- the-art technology to enhance customer ‘experience’. In turn, the client avoids IT and staff overheads and makes its customer service more efficient. Call centre outsourcing arrangements vary in scope and can include both inbound and outbound services. Inbound services will generally cover the management of communication from the clients’ customers; call centre staff will handle requests for insurance products, queries about existing insurance arrangements and online sales.
Outbound call centre services, as the name suggests, involve call centre agents making calls to customers or potential customers on behalf of the client. Outbound services can include telesales and marketing, customer research and surveys and the gathering of market intelligence.
Claims handling outsourcing
Claims handling is key to customer satisfaction and business growth. In recent years, more and more specialist insurance service providers have been coming forward to offer claims handling services. These can include:
- taking the initial call reporting the claim;
- notifying interested and affected parties, and coordinating communications between them;
- managing information relating to the claim;
- tracking the progress of the claim;
- settling the claim.
Policy administration outsourcing
Policy administration outsourcing varies in scope but services commonly include:
- taking customer calls and collecting and capturing data so that the management of and access to customers’ data is prompt and efficient;
- underwriting policies through automated processes that incorporate the client’s set underwriting rules and guidelines;
- dealing with insurance billing and premium payments, handling the printing and mailing of insurance policies, correspondence and product campaigns.
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