Application Outsourcing in Insurance - PEAK into the Evolving Service Provider Landscape

1 Nov 2011
by Jimit Arora



The Banking, Financial Services, and Insurance (BFSI) industry is one of the largest adopters of IT application outsourcing (AO) services. To cater to this large market segment, a diverse set of service providers have developed capabilities to deliver AO services to BFSI companies.

As mature BFSI buyers seek to optimize their portfolio of AO services, they are signing larger contracts with a fewer number of service providers. Further, as BFSI buyers drive further consolidation in response to their business requirements, the vertical specific capability of service providers to undertake and deliver large-sized AO engagements becomes a factor of prime importance.

In this research, we analyze the capabilities of 18 leading AO service providers specific to the global insurance sector. These providers have been mapped on the Everest Group Performance | Experience | Ability | Knowledge (PEAK) Matrix, which is a composite index of a range of distinct metrics related to a provider’s capability and market success.

Everest Group PEAK Matrix for large insurance AO relationships 

Scope of the analysis

  • Industry: Insurance (life and pensions as well as property/casualty insurance); excludes health insurance, banking, and capital markets
  • Services: Large (TCV >US$25 million), multi-year (>3 years), annuity-based application outsourcing
  • Geography: Global
  • Service providers: 18 leading insurance AO service providers – Accenture, Atos, Capgemini, CGI, Cognizant, CSC, HCL, Hexaware, HP, IBM, Infosys, L&T Infotech, MindTree, MphasiS, Softtek, Syntel, TCS, Wipro

Average insurance AO revenues and FTEs 


This report is structured across three key sections, each containing insights on the insurance AO service provider landscape, focusing on large-sized contracts:

  • Insurance AO service provider landscape: Analysis of individual service provider capability and service provider groups across the following dimensions:
    • Scale
    • Scope
    • Domain investments
    • Delivery footprint
    • Market success
  • Insurance AO PEAK characteristics: Analysis of each of the categories on the Everest PEAK Matrix - ‘Market Leaders’, ‘Major Contenders’, and ‘Emerging Players’
    • Commentary on capabilities of each service provider
    • Delivery capability characteristics (Scale, Scope, Domain investments, and Delivery footprint)
    • Market success characteristics (Transaction activity)
  • Implications for key stakeholders: Implications of trends on buyers and service providers

Some of the findings in this report, among others, are:

  • The service provider landscape for insurance AO services is segmented into four major categories of providers: global majors, offshore majors, regional players, and tier-2 Indian providers
  • Global majors dominate insurance AO market in terms of revenue, depth of capability, and breadth of delivery footprint; offshore majors have the highest average headcount and witnessed the fastest growth in average revenues as well as new accounts in the last three years
  • Tier-2 Indian providers have also built meaningful offshore scale to support large relationships for insurance AO buyers; where as regional players have been successful in winning contracts, primarily in the domestic/local markets
  • PEAK clusters’ characteristics
    • Leaders account for a majority of active ACV and TCV of large insurance AO contracts, and have the strongest portfolio of proprietary solutions for insurance AO delivery
    • Major Contenders have augmented their delivery capability by establishing relevant product partnerships in this vertical, and are growing their scale through acquisitions
    • Emerging Players have leveraged their strength in broader application services and tailored their offerings to meet the specific requirements of insurance AO buyers

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