The Market Is Stable For Insurance Call Centers
Even in the best of times, some insurers resist making big new investments in call center technology, experts say.
Many smaller insurers “tend to deal with a lot of questions without having a formal call center,” says Larry Fortin, director of the insurance practice at Edgewater Technology Inc., Wakefield, Mass.
Insurers that do have call centers to make sales or handle customer service face a constant temptation to outsource these services, he notes.
When Baltimore Life Insurance Company, Baltimore, needed a call center a year ago, it outsourced. “There are very efficient call centers out there,” explains Gary Voith, an assistant vice president at Baltimore Life. “They do it for a living.”
Even many insurers that have call centers send some business to outside service centers.
“We staff to the valleys,” says Al Pratico, director of direct sales at Blue Cross and Blue Shield of Florida, Jacksonville, Fla. “We try to offload the peaks to service centers.”
Meanwhile, in 2003, “people are pausing to take a breath,” says Don Van Doren, president of Vanguard Communications Corp., Morris Plains, N.J., a consulting firm. “Theyre asking themselves, Are we achieving the results we want? How do we use this stuff that we have?”
“Its too expensive to run the operations the way they are,” says Kevin Kraft, a financial services consultant at Cap Gemini Ernst & Young L.L.P., New York.
But figures from the New York office of DataMonitor P.L.C. show that the insurance market has been reasonably stable.
U.S. and Canadian insurers spent about $2.7 billion on call center hardware and software, or an average of about $14,800 for each of their 180,500 call center seats in 2002, up from $2.6 billion, or an average of about $14,400 for each of 178,200 call center seats in 2001.
The purchases include products such as call distributors, predictive dialers, terminals for agents and managers, servers, system software and application software.