Transcribe In-House or Outsource? Seven Factors to Consider

Assessing Your Options

Understanding how other insurers manage recorded statement transcription and the implications of transcribing in-house vs. outsourcing, will help insurers determine their own approach. Until now, insurers and third party administrators (TPAs) have had little insight into how their peers procure recorded statement transcription services. Many insurers use in-house transcription teams, some outsource, while others take a hybrid approach.


How Other Insurers Are Answering This Question

Traditionally, insurers maintained internal staff for recorded statement transcription. This began to change a little over 20 years ago when some insurers began outsourcing recorded statement transcription work to various vendors. Since then, the popularity of outsourcing has only increased.

Allegis’ 2014 market research indicates that eighty percent of the top twenty five largest property and casualty (P&C) insurers outsource at least part of their transcription. Sixty five percent outsource all transcription to one or more vendors. Fifteen percent take a “hybrid” approach by utilizing both an in-house team and partially outsourcing. Twenty percent keep all transcription in-house.


Every Insurer Has Unique Transcription Needs

Every insurer is unique and what works for one insurer may not be the best option for another. The remainder of this post details seven major areas to take into account when determining your approach to recorded statement transcription.


Seven Factors to Consider


Outsource: Vendors closely monitor turnaround times based on strict service level agreements. Contracts often stipulate penalties for missed turnarounds. Some vendors may prioritize work from certain clients over others.

In-House: Staff vacations or illnesses can impact reliability. Having transcriptionists on-site can make it easier for management to monitor productivity and ensure on time transcript completion.



Outsource: Transcriptionists are typically spread out geographically. This model tends to expand access to workforce talent. Some vendors are 100% US-based, while others use transcriptionists from across the globe, often based in countries such as India or the Philippines.

In-House: Many insurers have on-site teams, but our recent market analysis found a growing number of insurers using remote, employee transcriptionists. As employees they still receive traditional benefits, but work from home. Also, to a lesser extent, we found that some insurers are using independent contractors, while continuing to manage these individuals with internal resources. We should note that we have not seen insurers use remote transcriptionists based outside the U.S.



Outsource: Transcriptionists are only paid for the amount of work produced (e.g. number of minutes or pages transcribed), which incentivizes productivity.

In-House: Sick leave and vacation days can cause fluctuations in production capacity. Workers may be paid the same regardless of how quickly they complete a project.



Outsource: Vendors can typically offer their services for less because many hire independent contractors. This eliminates the need to pay fringe benefits, taxes, health insurance and other related expenses.

In-House: Many insurers with in-house teams hire transcriptionists as full-time employees, which necessitates paying for benefits.



Outsource: Venders often have substantial experience in regularly hiring and maintaining a large workforce.

In-House: Taking on hiring and turnover costs can be more than many insurers anticipate.



Outsource: This varies from vendor to vendor and the greatest factor affecting quality tends to be workforce location. For example, US-based transcriptionists tend to produce higher quality transcripts than transcriptionists based in the Philippines. The rigorousness of a vendor’s quality control process also plays a large role in quality outcomes.

In-House: This can be a challenging issue for those overseeing in-house teams. Benchmarking your team, especially smaller teams, can be difficult and hiring quality control staff can be cost prohibitive. Although, for in-house, on-site teams, having a supervisor physically present and reviewing work can promote higher quality work.



Outsource: This depends on how a vendor receives audio files and returns completed transcripts. Unsecured email is notoriously risky. Secured online order management, secured TLS email, or Secure File Transfer Protocol (SFTP) can be very safe.

In-House: If an in-house, on-site team uses secured emails, this can be a very secure setup. Teams that neglect to secure their email communications (e.g. TLS encryption) and/or work offsite without implementing security software, VPN connections, and other important security measures can expose the company to significant security risks.

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