Insurers are embracing robotic process automation and artificial intelligence to boost productivity and efficiency and lower costs, while use of the cloud allows testing and implementation of new business models and technologies to grow market share.

Nasdaq-listed Information Services Group (ISG) says insurers across the globe face increasingly demanding customers, and as a result they are turning to technology outsourcing providers.

Business Process Outsourcing (BPO) providers and Third-Party Administrators (TPAs) offer a variety of technologies that can help insurers streamline customer-facing processes and provide better experiences across contact channels, the advisory firm says in a new report.

The report examines four different client archetypes looking for insurance outsourcing services, and evaluates the capabilities of 15 providers to deliver services to these four buyer profiles: Transactional, Automation-Led, Transformation-Oriented and Holistic.

Outsourcing providers can digitise processes across the insurance policy lifecycle and this helps traditional insurance carriers keep up with new insurtech challengers, ISG says.

“Insurance customers are increasingly tech savvy and comfortable with online purchases and communications with their insurance carriers,” ISG partner Paul Schreiner said. “Customers today expect all interactions with their insurers to be frictionless, efficient and positive.”

Traditional insurers face tough regulatory requirements as well as growing competition from a new breed of digital-first insurance vendors, and want technology service providers to help.

Insurers also look to BPO providers and TPAs to help them grow market share, boost revenue, and expand their footprints, the report says, as these providers can help get products to market quickly, explore new markets and improve customer experience.

In addition, they help protect customer data with security capabilities that exceed regulations.

ISG says it specialises in digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management and market intelligence.

The research examined providers across Australia, New Zealand, Europe, the US and Brazil.