Learn key factors when determining whether to work claims in-house or outsource.
What are some factors that influence whether to work claims in-house or outsource?
Mike Lorenz: “The primary factor in determining in-house or outsourcing is your internal cost versus your external cost. And your secondary decision should always be around what specialties you have access to versus what you don't, and trying to address those specific needs within the book of business, such as work comp, TPL, or VA, by looking for external sources that can address those with expert knowledge.
Also, you can't just pick the lowest-priced vendor, and I don't feel like you should ever try to accomplish everything with a single vendor. A lot of vendors do offer a multitude of services, but they may have a specialty that they're better at than others. I think the best approach is understanding what your needs are, what you can effectively and efficiently handle in-house, and then identifying areas and expertise where you need that external support.”