A survey of insurance industry CIOs on the level of IToutsourcing shows 85 percent currently are using outsourcing firmsfor some elements of their operation, according to a new report bythe research and advisory firm Novarica.

Between 25 and 35 percent of those surveyed also reported plansto increase their level of outsourcing in 2012, according to MattJosefowicz, partner and managing director for Novarica. “InsurerCIOs across the industry are embracing outsourcing and blendedstaffing strategies in order to enhance productivity withoutincreasing fixed overhead,” says Josefowicz. “With the imperativeto 'do a lot more with a little more,' blended sourcing can helpinsurers stretch their IT resources.” Among the key findings of thereport:

• 85 percent of insurers are using at least some outsourcingservices today in either variable staffing/staff augmentation,legacy application maintenance, or data center or infrastructuremanagement.
• Large insurers outsource more than 25 percent of their IT work,while small and mid-size companies typically outsource only 15percent of their IT work.
• More than a quarter of large insurers are planning to increasetheir reliance on outsourcing in variable staffing, legacyapplication maintenance, and data center/infrastructure.
• Midsize and small insurers are half as likely to be planning toincrease their usage rates of variable staffing and legacyapplication maintenance, but are nearly as likely to be planning toincrease data center or infrastructure management outsourcing.
• Midsize and small insurers are twice as likely to see a highvalue in data center and infrastructure management outsourcing thanlarger insurers are. About a third of the respondents intendto increase infrastructure outsourcing, regardless of companysize.