Latest Annual Report on Insurance BPO Suggests the Emergence of Automation and Analytics as Key Drivers of BPO Expansion
DALLAS, TX: Everest Group is a global management and consulting firm. Their latest annual report on insurance BPO gives a fair idea on BPO expansion and the main factors that are influencing it. Findings in the report include adoption trends across geographies and insurance segments, key solution characteristics, emerging trends and service provider landscape.
The global insurance BPO market has grown at a Compound Annual Growth Rate (CAGR) of 12 percent over the last two years reaching 2.9 billion U.S.dollars. While Life and Pension (L&P) segment accounts for larger share of the market, the Property and Casualty (P&C) segment is growing at a faster rate with a CAGR of 22 percent; which is three times that of L&P’s CAGR of 7 percent over the last two years. North America dominates the P&C with large buyers continuing to drive adoption in L&P insurance BPO and small size buyers driving it in the P&C segment.
With the commoditization of labor arbitrage, Robotic Process Automation and Analytics have emerged as two key levers.
Adoption of automated platform-based solutions is reducing the FTE influence on transaction-based processes. With judgment-intensive processes considering analytics as the major differentiator, inclusion of analytics in new insurance BPO contracts has increased over 80 percent in recent years, while inclusion of RPA is now gaining speed because of significant cost savings. RPA can yield incremental cost reduction of at least 15 percent for off-shore operations and a maximum of 45 percent for on-shore operations.