According to Novarica's recent “IT Outsourcing Update,” an increasing number of insurers are looking to outsourcing to help manage costs while upgrading technology environments.

European insurer RSA is following the outsourcing blueprint closely. The company recently extended its business process outsourcing (BPO) agreement with Accenture through 2021 and inked a seven-year IT infrastructure deal with Wipro, an industry tech provider.

Outsourcing, however, is not an exact science, says Darren McKenzie, RSA’s COO of UK and Western European operations.

“As with any partner, you have to make sure that they are on the same strategy. We work closely with all our partners to make sure we operate strong governance around achieving our business outcomes,” he said. “Having the right people with the right skills in the retained organization to work together as a strategic partner is vital.”

Under the Accenture agreement, the software provider will take over IT maintenance, policy processing and customer support across RSA’s sales, claims and finance operations. Most aspects of these services were already in place, according to Accenture. RSA will receive infrastructure for mainframe, mid-range, storage and cloud from Wipro. RSA also implemented Wipro’s multilingual service desk for employees in the UK, Ireland and Scandinavia. Wipro failed to comment on this story.

“The Wipro partnership is a major step forward in our group technology strategy,” says McKenzie, . “It enables us to provide a market-leading, agile, affordable and secure infrastructure platform.”

The Novarica report states that spending on external services already consumes 20% of insurance IT budgets. Outsourced staff accounts for upwards of 40% of all IT personnel. To be sure, large carriers like RSA outsourcing isn’t all too new, but the shift in strategy across the industry is. More than half of the smaller insurance CIOs surveyed by the researcher said they plan on tapping third parties for help in infrastructure and application development and maintenance (ADM).

For RSA, "the Accenture partnership brings a great deal of energy to our organization and access to a range of capabilities and thinking that will help us to transform our business," McKenzie adds. "This brings operational capabilities including efficiency through its use of the latest tools like automation and analytics."

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