Onshore Outsourcing: In Insurance BPO It’s Really Happening

The recent political debates focused on “outsourcing” neglect the fact that many companies are outsourcing to their own backyards. In fact, new research from HfS shows that about half of the buyers either already have outsourcing delivery sites in the United States or are interested in establishing them. To meet this growing demand for domestic outsourcing, each of the top 20 global services providers today has U.S. sites in place. However, meeting the needs of companies isn’t a location-only issue: Providers must offer an effective delivery model. We are now seeing the emergence of onshore business process management in industries such as insurance and healthcare payor, which have genuine needs for local knowledge and expertise.

To illustrate this dynamic, we examine how ING and Cognizant are working together to create the kind of strategic relationship that can bring complex onshore-centric delivery models to fruition in the insurance BPO category. In June 2012, these two companies signed a $330 million, seven-year deal utilizing multiple U.S. locations in conjunction with their offshore sites. This agreement exemplifies the advances we anticipate will create greater demand from other insurance companies – as well as providing a global delivery framework from which providers and buyers can learn in other industries.