New research from IDC Financial Insights shows that global insurers will spend nearly $101 billion on IT in 2015, an increase of 4.4 percent compared with 2014.
The report, “Global Insurance 2015 Top 10 Predictions: Perils and Prospects for the New Year,” says investments will be focused on new core applications development and management such as data warehousing, claims and policy administration systems.
These replacements or refreshes are needed as legacy IT systems become increasingly complex, inflexible and archaic, to the point of negatively affecting technology integration and interoperability, said Li-May Chew, associate research director and global lead for IDC Financial Insights' Worldwide Insurance Advisory Service.
Insurers are also spending on change transformation and business optimization initiatives to augment productivity and support intermediaries; as well as in knowledge management, business analytics and customer relationship management applications to improve underwriting insights, raise customer centricity and intimacy, according to the report.
"Global insurers need to know where and how to seek pockets of growth amidst economic uncertainty,” Chew said. “In order to regroup and focus on sustainable, profitable growth, organizations will have to confront multiple perils—ranging from reengineering or rebuilding legacy applications, to countering mounting insurance fraud—and still ensure they are well positioned to embrace growth prospects as these present themselves.”
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