Insurance cos to raise IT investment by 4.4% to $101 bn in 2015

Insurance companies globally will increase their IT spending by 4.4 percent to $101 billion in 2015, said IDC.

Insurance companies will be spending technologies and innovation.

Some of the IT investments will be in new core applications development and management such as data warehousing, claims and policy administration systems, replacing legacy IT systems that are becoming unviable.

The other areas of IT investments will be in change transformation and business optimization initiatives to enhance productivity and support intermediaries.

Global insurance companies will also be investing in knowledge management, business analytics and customer relationship management applications to improve underwriting insights, raise customer centricity and intimacy.

Digital will be one of the focus areas. Digital portals of the Internet, social platforms, and mobile delivery will gain momentum.

Emerging markets – including Brazil, Russia, India, China, and South Africa, Chile, Colombia, Mexico, Argentina Thailand, Indonesia, Malaysia, and the Philippines — continue to shine. While cumulated spending for these nations may be $19 billion, this will rise at a three year compound annual growth rate (CAGR) of 6.7 percent between 2015 to 2018, which is double that of mature nations.

IT in Insurance

Li-May Chew, associate research director, IDC expects the 3-year CAGR in mature nations to be 3.1 percent and globally to be 3.8 percent.

The focus will be on transforming the IT enterprise with effective reengineering programs.

Marketing leaders will collectively spend $6.6 Billion in 2015 to enhance the total customer experience.

Insurers’ channel outreach will be digitally driven, transforming their distribution delivery with up to a third of premium sales transacted via Internet-enabled computer or mobile devices and social networks by 2018.

As the threat of fraud heightens with the digital revolution, insurers will need to spend $3.3 Billion in 2015 to invest on information security and to counter financial crimes.

Baburajan K
[email protected]