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ICT investment trends in insurance

ICT investment trends in insurance

Summary

While providers intend to make some or significant IT investments across all insurance business functions through 2016, vendors need to respond to this in relation to the current market dynamics across the sector. More providers invested in modernizing their core systems such as policy administration and claims processing in order to improve infrastructure and policy service, as well as to achieve efficiency and lay the groundwork for growth and investment in new digital technologies

Key Findings

  • Modernization of core systems has been top of mind for insurers through 2016
  • Insurers will boost investment in real-time analytics in the next two years
  • Vendors are in turn expected to better contextualize their solutions and services
Synopsis

ICT investment trends in insurance presents the findings from a survey of 99 insurers regarding their Information & Communications Technology (ICT) investment trends. The survey investigates how insurers currently allocate their ICT budgets across the core areas of enterprise ICT expenditure: hardware, software, IT services, communications, and consulting. The report illustrates the core technologies insurers are investing in, including business intelligence, internet of things (IoT) and green IT & virtualization. Understand the approach adopted by insurance companies to purchase technology and get a better insight into ICT vendors and services providers when pitching their solutions to insurers. The report focuses on insurers’ ICT expenditure trends for specific business areas, identifying the top three IT projects, and understanding the business challenges faced by insurers.

In particular, it provides an in-depth analysis of the following:
  • How ICT budgets are set to change in 2015 in terms of their overall size
  • Allocation across the core elements of IT spend, including hardware, software, services, communications, and consulting
  • Distribution of ICT money in areas such as the business intelligence, internet of things (IoT) and green IT & virtualization
  • Which ICT functions insurers are interested in outsourcing
  • Insurers’ investment priorities based on their budget allocations across core technology categories such as business intelligence, internet of things (IoT) and green IT & virtualization
  • Factors that are influencing insurers’ investments in each technology category
  • How insurers’ IT budgets are currently allocated across various segments within a technology category
  • Insurers’ distribution of their ICT budget across various segments within a technology category
  • Vendor satisfaction ratings for various core and advanced technology categories
  • Insight into insurers’ preferred buying approaches
  • Business objectives that insurers are looking to achieve through their IT investment strategies
Reasons To Buy
  • Understand how the insurers’ ICT landscape is set to change in 2016 to prioritize your target market
  • Comprehend how ICT money are being allocated by insurers in specific verticals and size bands to improve your market penetration
  • Make effective business decisions by recognizing the opportunities within each of the core areas of ICT spend (hardware, software, IT services, telecommunications, and consulting)
  • Realign your sales initiatives by understanding the current strategic objectives of insurers
  • Enhance your market segmentation with the included, detailed breakdown of opportunities within selected technology categories (Business intelligence, Internet of things (IoT) and Green IT & virtualization)
  • Prioritize your focus areas by understanding which factors are influencing insurers’ decisions when selecting an ICT provider
  • Understand the changes in customers’ priorities and identify the business and IT objectives that insurers are looking to achieve through their ICT investment strategies


1 Trends in ICT budgets
1.1 Introduction
1.2 Survey demographics
1.3 ICT budget changes
1.4 ICT budget allocation by core technology area
1.4.1 Hardware budget breakdown
1.4.2 Software budget breakdowns
1.4.3 Third party IT services expenditure
1.4.4 Telecommunications budget
1.4.5 Cloud computing budget
1.5 Outsourced IT functions
2 ICT investment priorities and vendor satisfaction
2.1 Introduction
2.1.1 Business intelligence
2.1.2 Internet of things (IoT)
2.1.3 Green IT & virtualization
3 ICT procurement trends
3.1 Introduction
3.2 Business objectives influencing IT investment strategy
3.3 ICT provider selection
3.4 Key decision maker for purchasing technology
4 Sector-specific trends
4.1 Introduction
4.2 IT expenditure plans for specific business areas
4.3 Business areas receiving the largest investments
4.4 Upgrades in business areas
5 Appendix
5.1 Definitions
5.2 Further reading
5.3 Contact the authors
List of Figures
Figure 1: Insurance - enterprise ICT survey geographic breakdown
Figure 2: Insurance - enterprise ICT survey breakdown by size band (number of employees)
Figure 3: Recent and expected ICT budget changes among insurers
Figure 4: Insurers’ (external) ICT budget allocation, 2015 and 2016
Figure 5: Insurers’ average hardware budget allocation
Figure 6: Average allocation of software budgets in insurance
Figure 7: Insurers’ average IT services budget allocation
Figure 8: Insurers’ average telecommunications budget allocation
Figure 9: Insurers’ average cloud computing budget allocation by technology
Figure 10: Insurers’ average cloud computing budget allocation by implementation type
Figure 11: Outsourced IT functions – insurers’ current and future outsourcing priorities
Figure 12: Business intelligence – insurers’ current and future investment priorities
Figure 13: Internet of things (IoT) – insurers’ current and future investment priorities
Figure 14: Green IT & virtualization – insurers’ current and future investment priorities
Figure 15: Business objectives which influence insurers' IT investment strategy
Figure 16: Factors influencing insurers' decision to choose an ICT provider
Figure 17: Role of key entities in making ICT purchasing decisions
Figure 18: IT expenditure plans in 2016 compared to 2015, for specific business areas within insurers
Figure 19: Top three IT projects in 2016 for insurers
Figure 20: Upgrades in the following business areas for insurers

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