Chief Underwriter Advises Companies to Tread Carefully When Outsourcing IT Functions
WARREN, NJ, May 24, 2006 - Handing over information technology functions to an offshore contractor thousands of miles away can pose significant risks
to service quality and data security and create potential legal liabilities. But businesses can mitigate these risks if they
enter into a comprehensive outsourcing agreement with a reputable IT firm.
This is the conclusion of an article that appeared this week on Computerworld online. The article, "Managing the Risks of Offshore IT Outsourcing," was written by Steven R. Pozzi, senior vice president,
Chubb & Son, and chief underwriting officer for Chubb Commercial Insurance.
"Outsourcing contracts need to be comprehensive in scope and detail exactly what work is going to be done, how it will be
done, who will do it, who is responsible for supervising the work, and what milestones and performance criteria must be met,"
Pozzi writes.
Pozzi also writes that companies that outsource IT functions could face lawsuits if they don't take steps to protect non-public
personal information. "If an employee of the contracting firm steals or misuses confidential or personal information that
causes a violation of U.S. privacy regulations, the U.S.-based client would be the likely target of any lawsuits," he writes.
"Outsourcing contractors must meet U.S. and foreign mandates relating to privacy legislation and public disclosure laws, such
as the Sarbanes-Oxley Act."
The article is available online at: computerworld.com/action/article.do?command=printArticleBasic&articleId=9000673
The member insurers of the Chubb Group of Insurance Companies form a multi-billion dollar organization providing property
and casualty insurance for personal and commercial customers worldwide through 8,000 independent agents and brokers. Chubb's
global network includes branches and affiliates in North America, Europe, Latin America, Asia and Australia.
|
