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📋 '''Single sourcing''' is a deliberate [[Definition:Procurement | procurement]] strategy in which an insurance organization chooses to fulfill a particular need — whether for technology platforms, claims services, or [[Definition:Reinsurance | reinsurance]] capacity — through one supplier, even though multiple qualified alternatives exist in the market. Unlike [[Definition:Sole sourcing | sole sourcing]], where only one viable provider is available, single sourcing reflects a conscious decision to concentrate spend with a preferred vendor. In insurance and [[Definition:Insurtech | insurtech]], this approach is common when carriers select a single [[Definition:Policy administration system | policy administration system]] vendor, a single [[Definition:Third-party administrator (TPA) | third-party administrator]] for a line of business, or a single [[Definition:Managing general agent (MGA) | MGA]] partner for a delegated program.

⚙️ The mechanics of single sourcing typically begin with a competitive evaluation — often a formal [[Definition:Request for proposal (RFP) | request for proposal]] process — after which the insurer awards the contract to one provider and maintains that relationship over a defined period. The buyer may negotiate volume-based pricing, service-level commitments, and integration requirements that would be difficult to replicate across multiple vendors simultaneously. In practice, an insurer implementing a new [[Definition:Claims management | claims management]] platform might single-source to a technology partner that offers deep integration with its existing [[Definition:Core system | core systems]], prioritizing operational continuity and reduced implementation risk. The relationship is governed by a [[Definition:Statement of work (SOW) | statement of work]] or master services agreement that specifies deliverables, timelines, and performance benchmarks.

🔍 While single sourcing can yield meaningful benefits — deeper vendor relationships, negotiating leverage through concentrated volume, and simplified contract management — it also introduces [[Definition:Concentration risk | concentration risk]] that insurance organizations must actively manage. If a single-sourced [[Definition:Vendor | vendor]] experiences financial distress, service degradation, or a [[Definition:Cybersecurity | cybersecurity]] breach, the insurer's operations may face significant disruption without a ready fallback. Regulatory frameworks in jurisdictions such as the European Union and the United Kingdom increasingly scrutinize [[Definition:Outsourcing | outsourcing]] arrangements and expect insurers to maintain contingency plans and exit strategies, particularly for critical functions. Thoughtful single sourcing therefore requires ongoing performance monitoring and contractual safeguards that preserve the buyer's ability to transition to alternative providers if circumstances demand it.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Sole sourcing]]
* [[Definition:Strategic sourcing]]
* [[Definition:Vendor management]]
* [[Definition:Outsourcing]]
* [[Definition:Request for proposal (RFP)]]
* [[Definition:Concentration risk]]
{{Div col end}}

Definition:Single sourcing - Revision history

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