In the earlier days, the need of insurance organizations was to fill a gap in staffing and solve the backlogs or to take on the tasks that no one else wanted to fulfill. These services were provided by insurance process outsourcing service providers at a substantial savings to the company acquiring this internal solution and this was one of the highly competitive fields.
The traditional notion of outsourcing however offered the insurance organizations an arbitrage on the costs of recruiting, training and maintenance of the in-house employees who were in all probability never too enthusiastic anyway about expending hours of data input across multiple systems. Over the time, of course it was realized that this was only an entrepot to a much more invigorating journey of value creation and addition.
A simple example explaining the above would be to estimate a fully loaded CSR cost as $50 and one could avail half the cost via outsourcing. This although may seem attractive but completely misses the greater opportunity as the same employee may be capable of supporting a $250 per hour of revenue. As such instead of swapping an in-house employee for an offshore resource for a $25 saving, an additional $250 revenue could easily be generated with the help of the same employee.
Many IPO’s offer a 2x return as well as 10x returns on a variety of outsourcing service models that can be chosen wisely as per the requirement of the insurance organization. It is however clear which one is more accretive to an agency value by means of meaningful factors. An insurance organization needs to add new business or invest in expansion to stay in the top lead and achieve organic growth. This is where Insurance process outsourcing services offer the perfect support and assistance to the company.