The days of shrinking IT budgest appears to be over for carriers. Recent research by such firms as Celent, Datamonitor and Forrester concludes that carriers plan on increasing their IT spending on average between 2.5% and 6.7%. However, INN's recent Web poll suggests those estimates may in fact be too conservative.Speed-to-market concerns are apparently fueling carriers' plans to hike IT spending. The areas of emphasis for P&C insurers, according to Datamonitor, are policy administration, claims processing, customer information and marketing, and agent/broker integration.

Andrew Bartels, a vice president at Forrester Research Inc., noted in our January 2004 issue that carriers may be looking to make big investments in the second half of the year. Bartels said he would not be surprised if more insurers decide that now is the time to do that major system upgrade or replacement of their core transaction systems.

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