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The need for expertise around data analytics and digital consumers has driven BPOs to increase their spending in global insurance industry. The cumulative spending is likely to hit the $3.5bn mark in 2015. BPO is strongly dependent on IT and the rise of digital consumers and as the modern consumer becomes more comfortable with digital marketing channels, insurers need to up their game to meet customer expectations.
“Insurers need help to understand the requirements and priorities of digital consumers and are looking to BPO service providers to help them navigate through this channel,” the Everest Group said. They further elucidated that the insurance sector will spend between $3.4bn and $3.6bn in 2015, and more than $700m worth of renewals will be available each year. Research by Accenture of 6,000 people in 11 countries revealed about a quarter would consider big internet companies – such as Google and Amazon – as possible insurance providers. Insurance companies have to catch up quickly and outsourcing to BPO suppliers with digital and analytics expertise will help. According to BearingPoint, 90% of insurance firms are yet to implement a company-wide big data strategy and risk being bypassed by new, more agile data aggregators taking advantage of the digital era.
It also forecasted that the Property and Casualty (P&C) insurance sector will grow at twice the rate of the more mature Life and Pension (L&P) segment. L&P accounts for 60% of total spending of the insurance sector.
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