American insurers have options in where they perform their business processesin-house, nearshore, or offshore. The subject has been the object of much hype and some scorn, but its reality may depend on an insurers needs and have little to do with either of those provocative points of view.

By Robert Regis Hyle

One thing technology has brought to the business world today is a higher set of expectations. Customers expect business to be conducted in a certain way, no matter whether you run a multibillion-dollar insurance carrier or your net written premium is less than $50 million. America may love the little guy, but if that little guy cant match the service offered by bigger competitors, customers have no qualms about taking their business to the option that will provide better service.Thats a key reason business process outsourcing (BPO) has caught the attention of insurance carriers of all sizes. BPO has leveled the playing field for insurers by allowing carriers to choose what services they can offer with the assistance of outsourcing vendors. Smaller carriers such as Piedmont Mutual Insurance Company, located in Statesville, N.C., operate in communities where the pool of tech-savvy insurance talent is quite a bit more shallow than their competitors. We are competing with companies operating in 50 states, says Jim Chick, Piedmonts controller. Even though were not as big as [the competition], we have to offer all the services the big companies offer.