Page 100 - MEDICAL AND HEALTH INSURANCE

MEDICAL AND HEALTH INSURANCE

5.6.1 BENEFITS AND CHALLENGES OF OUTSOURCING CLAIMS MANAGEMENT

The benefits of outsourcing claims management are:

 More cost effective in terms of contribution to the insurance company's overall

strategy and business objectives
 Expertise on the job, as they will have a team of more specialized professionals

for the job

 Fast response and flexibility in terms of customer services as their system is
more customer- oriented, specifically for such functions, unlike the insurance

company

 Monitoring the outsourcing arrangement to ensure it meets the service

standard

 Adequacy of the performance of the outsourcing company
 Financial stability of the outsourcing company, in settling payments to the

providers on time

 Contingency plan, should the outsourcing arrangement fail

5.6.2 RESPONSIBILITY OF THE INSURANCE COMPANY IN OUTSOURCING

The insurer has a responsibility to its policyholder that in any outsourcing activity, due

care must be taken to protect the policyholder's interests.
The role and responsibility of insurance company in the outsourcing programmed

include the following:

 Conduct due diligence checks on the selection of service providers that they
have the capacity and capability to deliver and perform the required

outsourced activities up to expectations

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