For all the controversy that has surrounded outsourcing in recent years, Scott Hawkins makes an interesting point, namely, insurers have been outsourcing some business processes since the first independent agent began doing business. "You really saw the first breaking down of the [in-house] business model with the use of noncaptive distribution," argues Hawkins, who is an analyst at Conning Research & Consulting.
Advocates of business process outsourcing (BPO) cite its advantages for carriers–the ability to: respond to new business opportunity without the build-up time needed to bring on additional staff; replace fixed infrastructure expenses with variable costs that directly relate to business demand; move employees from mundane tasks to challenging and revenue-enhancing activities. "Virtual" insurers have become the biggest users of BPO, willing to outsource all but the most essential, image-defining processes to third-party providers.
Yet despite the connectivity and business process workflow technology advances that facilitate effective BPO, Gartner reports outsourcing activity within the industry as a whole actually slowed throughout 2006 and into early 2007.
Recommended For You
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
