The more things change, the more they remain the same. Despite the accelerating impact of technology across the economic landscape, most insurers are remaining true to form and planning only modest increases for their 2015 IT budgets. They will be increases nevertheless, according to Novarica.
In an August 2014 survey of 88 insurance company CIOs, the market research and analyst firm found that average IT spending ratios will increase to 3.8 percent as a percentage of premiums. That’s up slightly from an average increase of 3.5 percent to 3.6 percent over the past four years. Only 10 to 16 percent of the CIOs indicated that their IT budget would likely decrease, while a small percentage reported that their budget increases would be “much higher.”
The most important business reasons given for the increase were the need to support greater growth and to increase speed to market. Among the highest-priority IT projects for 2015, the survey found that enhancements to policy-admin systems topped the list.
