The UK insurance sector may shed 20% of its workforce by 2010 - some 65,000 jobs - as call centres are moved abroad, management consultants Accenture has warned.
The UK insurance sector may shed 20% of its workforce by 2010 - some 65,000 jobs - as it moves call centres abroad, management consultants Accenture has warned.
They cite pay roll savings and the number of highly qualified staff in countries like India as the reasons. Their report stressed that companies would take this route out of necessity rather than choice.
Comparable pay rolls in India are between 10% and 20% of British levels. With costs of running offshore operations taken into account, annual savings could be approximately 40%-60%.
A number of major insurance companies have already transferred part of their support operations to offshore locations, including Royal & SunAlliance, BUPA, AXA and Churchill.
Insurance partner at Accenture Steve Lathrope said: "At the moment, most of these operations are small beer, with typically 20 or 30 people. As insurance companies gain experience and confidence, they will quickly look to move the bulk of their customer service and claims processing to India and other developing business centres over the coming years."
He added: "It is almost impossible for companies to make profits on their core insurance business in the UK."
