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2024年 生命保険ビジネスプロセス・アウトソーシング (BPO)のグローバル市場分析:効率化とイノベーションの推進

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2024/06/11

Abstract

Third Party Administration (TPA) and Business Process Outsourcing (BPO) offers insurers a way to reduce costs, address operational issues, and create new opportunities for growth. Insurers look to outsourcing vendors to reduce costs, increase agility, and improve digital capabilities to manage their business operations more efficiently. This report presents a unique market analysis of global life insurance outsourcing deals and the trends driving the industry foward.

The insurance business process outsourcing market has expanded greatly since Celent started analyzing it in 2011. As insurance company operations become more complex, insurers are constantly looking for specialized expertise and technology skills, all while trying to maintain or lower costs. Instead of hiring staff or building or buying technology solutions, many insurers choose to outsource functions like claims processing, policy administration, and customer support to third-party service providers. This outsourcing often includes using the outsourcing provider’s technology. Additionally, insurers are looking to outsourcers to help them digitize and automate operations.

The biggest difference between BPO and TPA is the type of work the outsourcer performs and the technology on which they perform it. BPO providers tend to be more transactional in nature and provide cost efficiencies due to the use of a common technology across all clients and low-cost labor. TPA providers tend to offer judgment-intensive processes, like claims decisioning, on vendor or insurer platforms. TPA was most often part of benefits administration outsourcing, but that has changed over time and more life insurers trust outsourcers with these processes. Even more common is the overlap between BPO and TPA as life insurers look to their outsourcing vendors for both capabilities.

Table 1: BPO and TPA Outsourcing Models

Outsourcing Model

Details

Traditional BPO

Primarily utilized for non-core activities,
with a focus on labor arbitrage and cost reduction

Digitally-
enhanced BPO

Delivers comprehensive support across business processes by providing skilled personnel and a select range of technological tools

BpaaS

(business process as a service)

Facilitates business process support throughout the value chain by offering on-demand access to people, technology, and infrastructure, following a pay-as-you-go model

Traditional TPA (third party administrator)

Delivers services encompassing specialized
areas of insurance administration while assuming financial risks associated with process management

Transformative TPA

Delivers services encompassing specialized
areas of insurance administration
using modern policy administration systems

Source: Celent

This report is designed to provide some context for discussion of the global life insurance business process outsourcing market by analyzing the current uses of BPO for core insurance services based on input from the companies providing services. To gauge the state of insurance BPO across the globe, Celent invited nearly 100 firms—all of which offer BPO services to insurers—to participate in a survey. Data was received on 567 deals from 14 vendors.

Twelve firms reported 224 global life insurance deals. These service providers include most of the companies that Celent believes constitute the top tier of insurance BPO providers. In addition to a survey, Celent conducted 12 qualitative follow-up interviews with key vendors to validate the findings from the raw data.

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