BPO firms eye actuarial services market in US, UK

                                                                                         

Business process outsourcing (BPO) companies such as Infosys BPO, Patni’s BPO arm, EXL Services and Genpact are increasing their focus on providing high-end actuarial services to insurers in the US and UK.

The Indian IT companies, which have been hitherto providing back office services (claims processing and others), are now planning to provide actuarial valuations.

Genpact, one of the largest players in the property and casualty space has been in actuarial services since the last five years.

Mohit Thukral, senior vice-president and business leader, Genpact, said, “In the last 4-5 years, the demand from these markets has doubled. We started with just 10 people and today have a base of 60-70 acturials and students.”

Actuarial processes constitute the extreme complex end of the knowledge process outsourcing (KPO) space. Actuaries are professionals who design insurance policies.

They assess the financial consequences of unforeseen events and the premiums needed to cover the risks. The Indian off-shoring industry is particularly strong in this area.

The total estimated revenues from Indian offshore insurance business process outsourcing (BPO) services were expected to rise from $790 million in 2007 to about $2 billion by 2010. Employment is also likely to increase from 41,600 to 1.5 lakh in 2010.

“One of the key reason for work coming to India, other than mature practices, is the shortage of skill-sets. An actuary in US with 5-6 years of experience gets a package of $150,000-250,000 and a acturial student will draw about $70,000-125,000 a month. When the same work comes to India, the cost saving is almost half,” added Thukral.

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