The global Life and Pensions Insurance BPO market will grow by 14 percent CAGR up to 2012 to reach nearly $4 billion, according to a new market study from NelsonHall. The study indicates that the market is poised for change as the industry adjusts to significant opportunities in the emerging markets of China and India.

Charles Juniper, Insurance Sector Analyst at NelsonHall, commented, “The geographic profile of the global L&P BPO market is set to see significant change with a major emphasis on supporting life companies in their efforts to establish a foothold in the emerging L&P markets of China and India . The L&P BPO market in China is forecast to more than triple in size by 2012.”  

In the mature L&P BPO market of the U.S. and U.K. the emphasis has moved from cost reduction as the primary goal towards an increasing customer service focus to drive new business growth and maximize the value of closed block business. The U.K. has seen most activity in the last five years and is currently the biggest geographic market. It is likely to see some consolidation amongst the U.K. life & pensions BPO providers. North America will overtake the U.K. to become the largest regional L&P BPO market by 2012 while growth in Continental Europe remains moderate at 11% CAGR.

Some of the other key findings discussed in the report include:  

• Following the success of BPO for closed block administration, the life industry is increasingly confident of BPO providers’ ability to generate new revenues and support life company brands. The majority of L&P BPO activity will be open block by 2012.
• There is an increasing opportunity for providers to undertake complex open block processing in sectors demanding high levels of customer service such as the high net-worth individuals or non-domiciled professionals segments.
• A significant increase in the volume and complexity of activity that will be performed offshore will occur in the next two to three years with India remaining the strongly preferred location.  

About this study

NelsonHall’s “Targeting Life & Pensions Insurance BPO” report is apart of NelsonHall’s Insurance Sourcing program. The study utilizes in-depth interviews with users and vendors to research key topics such as the major issues and buy-side requirements of life insurers, market size and growth as well as vendor offerings and go-to-market strategies. The report was written specifically for executives researching vendor capabilities before making purchasing decisions and market managers developing strategies to target segments of the L&P BPO market.

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