The global insurance BPO (Business Process Outsourcing) market is poised to grow at a CAGR (compound annual growth rate) of 5.19 per cent over the period of 2013-2018, according to a report by TechNavio, a technology research and advisory company.
The firm’s analysts estimate the current global insurance BPO market in 2013 at more than $4.6 billion, and is expected to reach $6.04 billion by 2018. One of the major factors driving the growth of the Global Insurance BPO Market is the cost-effectiveness of outsourcing certain operations of capital markets.
The Global Insurance BPO market can be segmented on the basis of BPO services into the following: (a) Property and Casualty, and (b) Life and Pension. Among the key vendors are EXL Services Holdings, Genpact, TCS, WNS Holdings, Accenture, Cognizant, Computer Sciences, Dell, Infosys, Wipro, and Xerox.
Insurance BPO is a segment of outsourcing, which consists of subcontracting the business processes of an organization to a third-party vendor that has expertise in the insurance domain. The outsourcing of complex processes such as actuarial analysis and underwriting and analytics support have increased in recent years and is expected to increase further during the forecast period.
Many client firms are outsourcing their back-office functions that require a stable infrastructure, capital investment, and human resources; thus, enabling them to improve their operational efficiency and cut costs through labor arbitrage. Like other companies, outsourcing this segment will not encompass core business activities particularly those specific to insurance.
“The outsourcing of business processes in the Insurance segment of the BFSI [Banking, Financial services and Insurance] sector has enabled multinational financial institutions to reduce their time-to-market through the adoption of lean business process models,” says Faisal Ghaus, Vice President of TechNavio Research.
Furthermore, the report states that data security is one of the major challenges faced by the market. The confidential nature of the Insurance market data makes it a risky affair, and extra measures need to be taken to ensure data confidentiality. The report also discusses in detail the market spending across these two segments and key geographical regions in the market.
TechNavio’s “Global Insurance BPO Market 2014-2018” is a market research report based on an in-depth market analysis with inputs from industry experts. The report also covers the Global Insurance BPO market landscape and its growth prospects in the coming years and also includes a discussion of the key vendors operating in this market.
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