Canada Life outsources IT to HCLTech, cuts 200 jobs
Editor’s Note: This article has been updated to clarify that the outsourcing of IT operations to HCLTech and the associated job cuts pertain to Canada Life’s Canadian business, not its operations in the United Kingdom.
WINNIPEG, CANADA — Insurance firm Canada Life is set to outsource its technology department to HCLTech, resulting in the loss of approximately 200 jobs.
The transition, expected to be completed by early July, aligns with industry trends to access advanced technology and expertise.
“Aligned with others in our industry, this partnership will provide Canada Life with access to the latest technology, skills and knowledge that will enable the company to better meet the growing expectations of our advisors and customers,” Canada Life stated, assuring that employees will be treated with care and respect during the transition.
This decision follows recent service challenges faced by Canada Life as the benefits provider for federal workers, which included slow wait times and claim refusals. Despite a public apology and a commitment to improve service, the job cuts have raised concerns about the company’s dedication to customer care.
Carmi Levy, a technology analyst, expressed skepticism about the move’s impact on service quality. “How this will better that service is hard to understand,” he said.
Canada Life officials highlighted their service “dashboard,” which reports call center inquiries answered within two minutes and claims processed within one to six days. They believe the agreement with HCLTech will enhance internal IT services, allowing for continued high standards of customer care.
However, Levy criticized the decision as a mere cost-cutting measure that overlooks the value of experienced staff.
“It fails to recognize what these experienced people brought to the table. It is an unfortunate trend,” he remarked, adding that it could negatively affect operations and customer experience.
Outsourcing in the tech industry is not new for Canada Life, which made a similar move in 1996 and later reversed it. “This is a company that has outsourced technology services in its history only to restructure years later,” Levy noted.
The announcement has sparked backlash on social media, with concerns about the insurer’s ability to support legacy systems and the strain on other departments. Clients have also voiced frustrations over service delays on Canada Life’s Facebook page.
As one of the largest global tech providers, HCLTech serves 10,000 clients with a workforce of about 225,000 across more than 60 countries. The job cuts at Canada Life are a significant development for the company and its clients.
HCLTech is a leading provider of digital, engineering, and cloud solutions to businesses around the globe. It recently secured the #7 spot in the OA500 2024, an objective index of the world’s top 500 outsourcing companies.
