Moving Beyond Costs To Enhancing Service

EXL Service’s Yogendra Goyal explains how the focus on outsourcing has moved beyond cost control and into ways to improve business processes and raise customer satisfaction.

Best’s Review: What areas of insurance should companies look at most closely when they consider a firm such as EXL?

GOYAL: Broadly speaking, five areas in business process outsourcing, and four areas in Research & Analytics services. In the business process outsourcing, these are agency management, where we do a lot of commission payouts to the agents who write the new policies, new business where we do underwriting support and policy issuance, customer service which includes address change, beneficiary changes, premium adjustments etc. Then we also do claims adjudication and interestingly, EXL Service is also licensed as a third-party administrator in 46 states in the United States. On the Research & Analytics side of business, the four areas are Marketing & Customer Analytics; Risk Management Analytics; Operations Analytics and Finance & Investment Analytics.

BR: What are insurers missing about their business processes and where do you fit into that?

GOYAL: I don’t necessarily think they’re missing any point. In fact all the insurers are trying their best to manage this new breed, a very informed and demanding customer base. As a result, insurers have become very sophisticated users of outsourcing models. Outsourcing dates back to the early ’90s, when they started adopting IT outsourcing. Now these carriers are looking at ways to reduce their operating expenses by outsourcing business processes.

We have seen a clear paradigm shift over the last three years where the driver for outsourcing has completely changed from cost reduction to customer service enhancement. Companies like EXL have emerged as very credible long-term partners to these insurers who no longer focus on cost reduction, which is a given if you go to India or any outsourcing destination.

Today, EXL partners with these companies on revenue enhancement opportunities. Just to give you an example, we do things like ‘How can I increase the retention rate? How do I increase the policy renewal rate? What are the underwriting principles being used? Can I make them best of breed?’

BR: Where would you fit into insurers’ concerns about compliance?

GOYAL: Working with EXL in particular positively impacts insurers’ ability to comply. As I mentioned earlier, we are not only in the business of providing outsourcing services; I give a lot of credit to our senior management who has remained committed to provide not only insurance services, but have created a suite of wraparound services such as Risk Advisory Services, where we’ve got 140 professionals who are CPA or equivalent in terms of their qualifications. They have five to seven years of Big Four accounting firm experience and these individuals help companies become compliant around Sarbanes Oxley, internal audit, IT applications control and finance control. When we migrate any particular process to India, first thing we ensure is the regulatory compliance.