The insurance industry relies heavily on insurance BPO outsourcing for tangible benefits like cost optimization, improved operational efficiency, boost in productivity, and many more.
Apart from the benefits, regulatory dynamism, frequent changes in the socio-economic climate, influx of competitors are some of the reasons why insurers trust insurance BPO outsourcing.
Predictions about the growth of the insurance BPO outsourcing market at over 20% CAGR through 2025 further justifies the increasing reliance on outsourcing. However, there are some factors which a carrier must consider while deciding to outsource. Here’s taking a look at those factors:
Quality or cost- what to prioritize? – Insurers should understand that the growth of the insurance BPO outsourcing market has resulted in an influx of service providers each with promises of the best service at affordable rates. Insurers must carefully try to understand which providers exhibit promise of utmost quality rather than just cost efficiency. To ensure the same, insurers must go through their client reviews and their experience in a particular domain that the insurer can relate to. They should insist for pilot projects with the service provider to determine their suitability to an insurer’s business requirements.
Ensuring quality– It is recommended that insurers conduct an in-depth evaluation of their service providers’ work culture and employee attrition rates, and level of adoption of technologies. These factors can reveal about the insurance BPO outsourcing vendors’ ability to provide services of consistent quality and with minimal disruption. Insurers should also keep an eye on their prospective vendors’ social media handles to check their clients’ feedbacks.
Whether to opt for on-shoring or off-shoring services– Insurers must factor in the service quality, cost, and communication mode while choosing between an on-shore or an off-shore insurance BPO outsourcing company. An onshore vendor gets the job done within the client’s location. Even though this makes communication between the vendor and client easier, it is a costly proposition as the client will have to invest in accommodation and infrastructure specific to the operation mode of the third-party experts. Meanwhile, communication will pose as a challenge for offshore vendor. In such cases, partnering with vendors who take a hybrid approach is the best way forward. They allow insurers to avail a perfect blend of offshore and onshore services based on the necessity of communication frequency between the client and vendor, the presence of the infrastructure at their site to accommodate the third-party experts, and their budget.
Ensuring security– The practice of some of the insurance BPO outsourcing companies to execute their clients’ services through their agency management system to achieve cost efficiency increases the chances of sensitive data leakage. Insurers must partner with vendors who can operate efficiently by setting up remote connections with their clients’ servers. This enables the manager to constantly monitor the data transaction, thereby securing the data. After the contract expiry, insurers must change the server password and obtain their control on the data.
The process of ensuring quality and ROI does not stop after finalizing partnerships with insurance BPO outsourcing companies. Insurers must keep a keen eye on the level of their partners’ adherence to all the contract SLA terms and what strategies they are taking to make their services more adaptive to the dynamisms witnessed in the insurance industry. This ensures more service quality and helps establish a favorable long-term partnership with insurance BPO outsourcing companies.