European insurers, facing challenging macroeconomic conditions, new market risks and changing customer demands, are seeking more agile, tech-savvy approaches to business, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.
The 2023 ISG Provider Lens™ Insurance Services report for Europe finds insurers are looking to modernize their legacy systems to stem the effects of new competitive pressures and rising costs. Rather than going it alone, many are turning to service providers that have the required digital IT skills and industry experience to help them transform their business models, the ISG report says.
“Insurance companies are willing to form long-term, mutually beneficial relationships with service providers,” said Anna Medkouri, partner and insurance industry lead for ISG EMEA. “These strategic partners can create immense value by applying IT, business process and insurance domain capabilities to business transformation, often with a relatively quick turnaround time.”
Europe’s insurers face a new world of developing risk and uncertainty due to a number of recent trends, the ISG report says. Inflation and increasing interest rates are impacting demand, growing regulatory pressure is increasing the cost of doing business, cybersecurity and climate risks are rising, and technology is changing customer expectations, the report says. This combination underscores the need for insurers to create more effective risk-modeling, pricing methods and innovative products, ISG says.
Although the combined threats and market changes may seem to paint a bleak picture for Europe’s insurance industry, insurers in the region have viable options for coping with these concerns, the ISG report says. With the aid of providers, they may swiftly embrace new technologies, re-evaluate old ways of doing business, increase cooperation and efficiency and pursue innovations to meet customer needs and company goals, ISG says.
“The outdated infrastructure and legacy systems that many European insurers rely on contain hidden costs that have a direct impact on their bottom line,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “Insurers need to prioritize next-generation technologies that stimulate innovation and streamline internal operations to increase profitability.”
The report also examines how replacing obsolete IT infrastructure with more sophisticated technology can assist insurers in addressing growing risks to data security.
The 2023 ISG Provider Lens™ Insurance Services report for Europe evaluates the capabilities of 36 providers across three quadrants: Life and Retirement (L&R) Insurance BPO Services, Property and Casualty (P&C) Insurance BPO Services and Insurance ITO Services.
The report names Accenture, Cognizant and TCS as Leaders in all three quadrants, while Genpact and WNS are named as Leaders in two quadrants each. Atos, Capgemini, EXL, HCLTech, Infosys, NTT DATA, Tech Mahindra and Wipro are named as Leaders in one quadrant each.
In addition, HCLTech, Hexaware and Sutherland are named as Rising Stars — companies with a “promising portfolio” and “high future potential” by ISG’s definition — in one quadrant each.
A customized version of the report is available from WNS.
The 2023 ISG Provider Lens™ Insurance Services report for Europe is available to subscribers or for one-time purchase on this webpage.
About ISG Provider Lens™ Research
The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe, as well as in the U.S., Canada, Brazil, the U.K., France, Benelux, Germany, Switzerland, the Nordics, Australia and Singapore/Malaysia, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.
A companion research series, the ISG Provider Lens Archetype reports, offer a first-of-its-kind evaluation of providers from the perspective of specific buyer types.
About ISG
ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 900 clients, including more than 75 of the world’s top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes 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; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,600 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry’s most comprehensive marketplace data. For more information, visit www.isg-one.com.
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