Gloabl Insurance BPO Market 2012


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Policy Administration, Claims processing, Underwriting Support, Compliance, Customer Service

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Gloabl Insurance BPO Market 2012

  1. 1. Global Insurance BPO Market 2012 Indian Players TCS, WNS, EXL Service, Genpact, Infosys dominate the market Rajesh Prabhakar Analyst Bio @
  2. 2. Global Insurance BPO Market 2012The global insurance BPO market has been valued at US$2 billion by the end of 2012.and segment grew by 17% annually. Third-party Business Process Services (BPS) inthe insurance industry currently a US$6-8 billion market growing at ~17% annually.Post 2008 Financial crisis there had been a stable growth in the number of contractssigned in both the Life & Pensions (L&P) and Property & Casualty (P&C) lines. In factthe contracts almost doubled in number when compared to 2008-2009 when thefinancial crisis had a severe impact on the insurance companies. BPS in insurancerebounded with 53 new, publicly-announced contracts signed in 2010-2011.United States and United Kingdom are the primary markets for Indian Insurance BPOvendors, but the market is also going global and activity is picking up in other regionsof the world too. Asia Pacific showed significantly increased activity over the last oneto two years .Insurers expect BPO as a key tool to cut costs, improve operations, and manageregulations. Service providers are differentiating their offerings through bettertechnology, strong delivery capabilities, and the ability to serve niche segments.Source: Everest Group. 1. ; 2. Rajesh Prabhakar Analyst Bio @
  3. 3. Everest Group Performance | Experience | Ability | Knowledge (PEAK) MatrixThe 2012 insurance BPO PEAK Matrix Leaders control 60% of the overallhas three: insurance BPO market in revenue Leaders (EXL Service, TCS, and terms with healthy growth rate. WNS) EXL Service is dominant player in the Major Contenders (Genpact, HCL, U.S. BPO insurance market. Infosys, and Wipro) TCS dominant in the UK BPO Emerging Players (Capgemini, insurance market Cognizant, and Serco) Source: Everest Group. Rajesh Prabhakar Analyst Bio @
  4. 4. Insurance BPO Service Providers &OfferingsIndustry-specific BPO accounts for over 60% of BPO contracts in insurance, spanningproduct development and business acquisition, new business, policy servicing andreporting, and claims processing.Leaders have a wide scale of operations and have a significant advantage over MajorContenders and Emerging Players. Capabilities of the major players differ not only interms of the variance of the service offerings but also in terms of the Geographies theyare servicing successfully.Leaders and Major Contenders have built delivery capabilities from various differentlocations and this global delivery presence is a big competitive advantage whencompared to Emerging Players.The five themes identified Everest group are Platform-based BPO offerings, increasingfocus on the U.S. closed books BPO market, inclusion of complex processes ininsurance BPO contracts, higher degree of on shoring, and regulatory and riskmanagement BPO.Source: Everest Group. 1. ; 2. Rajesh Prabhakar Analyst Bio @
  5. 5. Insurance BPO Vendor Profile – TCS BPOTata Consultancy Services (TCS) has been designated as a leader in insurance BPO in the EverestGroup report – PEAK Matrix. TCS is dominant in UK market through its subsidiary Diligenta.Diligenta, UK FSA regulated subsidiary was established in 2005 to specialize in the provision ofbusiness process outsourcing (BPO) services for the UK life & pensions industry. In 2006,Diligenta secured its first £486 million deal with the Phoenix Group (formerly known as the PearlGroup). Since then, Diligenta has secured a number of new clients in the Life and Pensions sectorand today administers circa 5 million policies.TCS has over three decades of experience, partnering with over 90 regional and global insurers toachieve improved operational efficiencies, reduced costs and customer / partner satisfaction andservices span all insurance segments - life, healthcare, property and casualty (general insurance)as well as annuities, pensions and retirement, and span the complete life cycle.Recently concluded a multi-year, multi-million dollar transformation project at Phoenix Group,the UK’s largest specialist consolidator of closed life funds that involved replacing anddecommissioning 11 major life and pension administration systems, hundreds of peripheralsystems and migrating more than four million policies and customer records, across multiplebrands and product lines into TCS BaNCS Insurance.TCS won its second-biggest outsourcing contract worth $2.2 billion from UK based pension firmFriends Life, based on a model wherein the company will be paid for each insurance transactionand will add another 3.2 million policies. Source: Rajesh Prabhakar Analyst Bio @
  6. 6. Insurance BPO Vendor Profile – EXL ServiceEXL’s insurance experience is proven by 60 leading global insurance carrier clients and the tenureof more than 4,000 industry professionals and is dominant player in the US Insurance BPOMarket. EXL provides high quality services and better controls support to clients allowing them tobe more efficient and to better understand their customers, their markets and their risks. Clientsleverage EXL’s outsourcing, analytics, advisory and risk management capabilities.Collaborate with clients to understand their priorities & design solutions to address insurers needsand support them to manage claims, enhance subrogation services, improve first notice of loss,build compliance preparedness, improve underwriting margins, optimize loss ratios, increasecustomer penetration or accelerate customer reach, & help P&C, life, annuity and health insurersbecome competitive.In October 2012, EXL acquired Landacorp, a provider of software in support of clinical dataexchange in the healthcare industry and acquisition brings 15 payer clients and 50 providerclients and Landacorp has 50 million members under management on its platformsIn October 2011, EXL acquired Trumbull Services, a specialized provider of Insurance BPOservices in the Property & Casualty (P&C) segment in the US, which has a ready-madetechnology platform to offer in U.S. P&C Insurance BPO space and the insurance subrogationBPO business in particular. In May 2010, it acquired PDMA, the maker of LifePRO, a policyadministration system in the Life Insurance BPO market deployed with 40+ insurers around theworld. Source: Rajesh Prabhakar Analyst Bio @
  7. 7. Insurance BPO Vendor Profile – WNSWNS insurance outsourcing service offerings extend across the insurance value chain of Propertyand Casualty, Life, Pensions, and Annuity. Services related to Product Development, Sales &Distribution, Policy Administration, Claims Administration, Analytics, Finance & Accounting andCustomer Care.With a dedicated team of over 7,500 professionals for the insurance industry, WNS manages over40 million claims per year helping insurers streamline their claims operations. WNS recentlypositioned industry leader for Insurance BPO in Everest Groups Insurance BPO PEAK Matrix.In January 2012, Australian insurance major Suncorp gave majority portion of the order worth$220 million to WNS for end-to-end insurance outsourcing for a period of five to seven years.WNS won a $228-million contract from UK-based Aviva in 2008 for all in-scope services relatedto Avivas life & general insurance businesses in the UK and Canada. Based on the anticipatedservice requirements of these businesses, WNS estimates Master Services Agreement couldgenerate $1 billion in revenues over the life of the contract. WNS also benefits from a recentlysigned AGS contract for approximately 580 employees with Avivas Irish subsidiary, Hibernian.In June 2012, WNS has acquired South Africa-based Fusion Outsourcing Services in an all cashdeal of over £10 million or $15.5 million. Fusion currently employs about 1,500 people and thecentre currently offers high-end voice services with plans to start financial, accounting andinsurance services. Rajesh Prabhakar Analyst Bio @ Source:
  8. 8. Insurance BPO Vendor Profile – GenpactGenpacts life and annuity clients include several top-20 life/annuity companies, a top-threereinsurer, the retirement services and insurance divisions of major financial institutions, a top-three global broker, and efforts with LOMA and LIMRA. Genpact’s more than 14 years of globalinsurance experience is supported by an extensive team of certified domain experts .Under the seven-year agreement with Ironshore, a leading provider of specialty lines insurance,Genpact will manage and standardize Ironshores end-to-end middle- and back-office operationsto increase effectiveness and productivity, allowing the insurer to focus on continued growth oftheir client-facing underwriting operations and further expansion into new markets.Key Service offerings include Application to Issue (A2I) Solution, Product Development, Salesand Marketing, Policy Administration ,Underwriting and Risk Management, Corporate Functions,agent services, actuarial analysis, underwriting support, claims processing, etc. Key insuranceclients include AON, BUPA, Genworth Financial, Travelers, All State, Max New York LifeInsurance, etc. MajescoMastek and Genpact has strategic partnership focused on the insuranceindustryGenpact’s global insurance practice is driven by a team of professionals who hold over 2,800insurance certifications, including LOMA, IIA, AAPA, FINRA Series 6, FINRA Series 7,AICPCU, and actuarial exams, of which LOMA certifications are 1,200.Genpact’s Insurance practice has 4500+ employees providing end to end services and also has400+ specialist staff in areas including underwriting and analytics. Rajesh Prabhakar Analyst Bio @ Source:
  9. 9. Insurance BPO Vendor Profile – Infosys BPOInfosys BPO insurance services include: Quotations, underwriting and associated complianceactivities, Financial administration (e.g., premium accounting, A/R), Claims adjudication,processing and review, Policyholder servicing (amendments with and without, underwriting),Agency management, Actuarial and analytics, Documentation fulfillment.In September 2012, Infosys BPO acquired the captive BPO unit of US-based insurance brokerageMarsh & McLennan Companies for an undisclosed sum and would add about $10-12 million ( Rs55-66 crore) in incremental annual revenue for Infosys BPO, would involve taking over of about87 employees. The transaction would add at least seven group life insurance clients for InfosysBPO.McCamish Systems LLC, an Infosys BPO company, specializing in end-to-end, enterprise-wideinsurance and retirement business process solutions, has increased its presence in the VoluntaryGroup Life Insurance business space by commencing operations in Des Moines, Iowa, USA. Theunit has 87 employees, serving seven insurers and covering more than 600,000 insured lives.Infosys acquired McCamish Systems in an all cash deal of $38 million in December 2009.McCamish Systems LLC signed a multi-year agreement with FaithLife Financial, a not-for-profitfinancial services organization that provides life insurance, health insurance, income protectionand investment products in Canada. Phoenix Life Insurance (Hartford) has signed a multi-yearagreement with McCamish Systems for selected blocks of its life insurance products, includingconversion of data, policy administration and customer support. Rajesh Prabhakar Analyst Bio @ Source:
  10. 10. Insurance BPO Vendor Profile – Wipro BPOWipro’s insurance practice works with 35+ global insurers including many among the Top 500organizations. Wipro customers include 4 of the top 6 P&C carriers in the world, 2 of the top 5health insurance and service providers globally and 4 of the top Life, Annuity & Pension carriersin the world. Wipro is uniquely positioned to provide strategic and innovative solutions based on3000+ person-years of experience in managing ~150Mn claims transactions annually for leadinginsurers.Offerings cover the entire spectrum of the insurance value chain from Sales & Distribution, PolicyAdministration, Risks & compliance and claims, straddling across Life and P&C markets anddelivered by over 6000+ dedicated resources. Wipro expertise in Business Advisory services,solutions and Centers of excellence reflect their commitment towards building the future ofinsurance. 4000+ consultants with an average experience of 10 years have delivered innovation inproducts, branding, marketing and pricing strategies.Partnerships & Alliances: Camilion Solutions, eBaoTech, OneShield, Pega Systems, Prima IBCS,SAP, SSP. Associated Services (ITO + BPO Bundled Service) – Managing approximately 115MNtransactions annually for their customers, Wipro is ranked amongst the top 3 in terms of volumeshandled in the BPO Space.With a client base of 140+ Health insurers and Offices spread across Atlanta - US, Monterrey -Mexico, Curitiba -Brazil, Wroclaw - Poland, Bucharest – Romania, Chengdu & Shanghai – China,Cebu City – Philippines, Yokohama - Japan, company is capable of providing multi-lingualsupport in English, Spanish, Portuguese, German, French, Chinese, Japanese. Rajesh Prabhakar Analyst Bio @ Source:
  11. 11. Insurance BPO Vendor Profile – HCL Tech BPOWith the strategic acquisition of Liberata Financial Services, regulated in UK by The FinancialServices Authority (FSA), HCL has the ability to offer comprehensive end-to-end administrativeservices and customer services to Life & Pensions Insurers. Key Service offerings include Agentlicensing, New business/underwriting, Policy Administration, Account Administration,Commissions, Claims management and actuarial services.HCL Practice Highlights: Top 5 Life & Pensions BPO service provider in UK, Platform basedBPO service provider for Life & Pensions market, Proven capability to offer actuarial services,Dedicated Insurance Competency Center headed by Insurance experts. Gartner rates HCL’sInsurance Outsourcing Practice as “Mature” in BPO for Life and Property & Casualty InsuranceOnly company to win the “Excellence in Insurance Education” award by LOMA for the 5thconsecutive year. Maximum number of Advanced LOMA certified resources in practice. Keycertifications are LOMA (FLMI, ACS, ARA…), AICPCU (CPCU, INS), CII (London)examinations and III-India (FIII).HCL’s insurance practice is built on strong domain expertise with proven application and processoptimization capabilities across the Quote-to-Claim cycle. HCL’s investment in product assets,intellectual property and dedicated Insurance Solution Development Centers, a strategicecosystem of partners and strong integrated business operations capabilities help insurers addressmyriad of business challenges.More than 10 clients & 8+ years experience in P&C space. FSA regulated Insurance Business Unitin UK. 1200+ people manage more than 4.6 million policies for marquee clients. Rajesh Prabhakar Analyst Bio @ Source: