{"id":1005,"date":"2015-08-25T12:51:00","date_gmt":"2015-08-25T12:51:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/insurance-aas-blueprint_082515\/"},"modified":"2015-08-25T12:51:00","modified_gmt":"2015-08-25T12:51:00","slug":"insurance-aas-blueprint_082515","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/insurance-aas-blueprint_082515\/","title":{"rendered":"TCS, EXL, Concentrix and Infosys set the As-a-Service pace for Insurance"},"content":{"rendered":"
Insurance is priming the pump for industry-centric As-a-Service<\/a> solutions. \u00a0The insurance space is one of those industries where it’s all in the sales, marketing and customer experience, so the more the delivery engine can he standardized and run efficiently, the more cost savings can be passed onto the customer and intelligent data to the service provider to set their policies, pricing and future strategies.<\/p>\n Insurance majors were among the first Western enterprises to open offshore captive centers in India and Philippines to process and adjudicate clients, support customer service etc. \u00a0However, the main issue that has long-plagued the carriers has been finding value beyond<\/em> the initial offshore cost-savings. \u00a0I personally recall hosting a roundtable of eleven major insurance BPO clients five years’ ago, and the common consensus was “The only way to find incremental value is by tech-enabling our processes”.<\/p>\n So has this industry been making genuine progress as we evolve to the As-a-Service model<\/a>? \u00a0So who better to ask than the one analyst who has been tracking this space intensely ever since she joined HfS four years ago,\u00a0Reetika Joshi<\/a>:<\/p>\n Click to Enlarge<\/p>\n<\/div>\n What is \u201cInsurance As-a-Service\u201d and how is it different from insurance BPO?<\/span><\/p>\n Phil, insurance is a mature market for BPO \u2013 core insurance processes like claims processing have been outsourced for over a decade now. Our discussions with property & casualty (P&C) and life & annuities (L&A) carriers across client markets indicate that these services buyers seek value beyond the transactional back-office work of the past. Their expectations include more delivery of standardized processes on modern business platforms, an expanded scope of services and the incorporation of robotic process automation and operational analytics in core operations. We see increased investment and interest from services buyers along with service providers to modernize core processes across the outsourced\/offshored\/in-house\/partner ecosystem to include these elements. For further reading, we published a report on this topic in May 2015 based on a buyer survey – Moving Insurance BPO into the As-a-Service Economy<\/a>.<\/p>\n What are some of the changes you\u2019ve seen in the market since the last Blueprint?<\/span><\/p>\n Industry forces are definitively impacting the nature of sourcing in insurance \u2013 be it more regulatory scrutiny and compliance requirements, aggressive competition, low margins or intensified market consolidation. To pull out a couple of examples:<\/p>\n We believe these industry forces, along with other equally relevant shifts in the global technology and services landscape, are gradually changing the nature of outsourcing in the insurance vertical towards more Insurance As-a-Service delivery. Our scoring methodology for this Blueprint has changed accordingly. Compared to the first Blueprint on Insurance BPO (Feb 2014), we increased the focus on innovation toward As-a-Service delivery, with 50% of the Blueprint scoring being tied to proven innovation capability and performance for these engagements, beyond the standardized insurance BPO processes.<\/p>\n How are winning service providers approaching this market differently, moving beyond basic operational services?<\/span><\/p>\n Service providers, after more than a decade of technology and business services expertise for insurance processes, are in a position to offer more consultative support to help design solutions and even operating models that are more modular, technology enabled and future-ready. Buyers are willing to act based on their internal culture, appetite for change and established relationships with service providers. Insurance As-a-Service is a reality for a growing subset of insurance BPO\/BPaaS engagements today. With this new focus on As-a-Service, we saw TCS, Concentrix, Genpact and EXL hold their leadership positions, as well as the entry of Infosys, Cognizant and WNS into the Winner\u2019s Circle.<\/p>\n Interestingly, the service providers in the Winner\u2019s Circle stood out for As-a-Service delivery for different reasons. Some like EXL have more BPaaS plays, some like WNS are in for focusing on outcomes. The common underlying factor however is their willingness to evolve, the success of their initial forays into including As-a-Service components and charting out progressive visions for insurance that is visible to their clients.<\/p>\n Reetika Joshi is HfS Research Director, Consumer-centric Operations and Analytics Strategies (click for bio)<\/p>\n<\/div>\n What do you expect for the future of Insurance As-a-Service?<\/span><\/p>\n Insurance operating models will continue to evolve to a more hybrid approach with in-house decentralized, in-house centralized, Shared Service Centers, TPAs and IT-BPO service providers as insurers gradually \u201clet go\u201d with:<\/p>\n Overall, HfS sees the insurance vertical as ripe for a rethink in design and execution for the As-a-Service Economy. The foundations are already present\u2014mature processes, service providers\u2019 domain experience, buyers\u2019 appetites for platform-based delivery, and burning platforms for change in business models for both L&A and P&C. However, insurance carriers need to get on board to ensure success. Services buyers need to make concerted efforts to align stakeholders around the As-a-Service economy. From our discussions with clients, service providers and other influencers, we see a pronounced lack of synergy around core operations from insurance carriers in P&C and L&A \u2013 across lines of business, inherited assets, TPAs, BPO and IT relationships. We see service providers continue to make investments that will disrupt this mature market in the next two years. Winning service providers are leading the way and starting to help clients navigate through this disruption by offering scalable and adaptable technology-enabled solutions. At HfS, we\u2019ll continue to report on these successes, failures and learnings on the long road to Insurance As-a-Service.<\/p>\n HfS readers can click\u00a0<\/i><\/b>here<\/i><\/b><\/span><\/a>\u00a0to view highlights of all our 23 HfS Blueprint reports.<\/i><\/b><\/span><\/p>\n<\/a><\/p>\n
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