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Insurers increase ICT investments due to changing customer expectations

26th November 2014

The digital revolution and changing customer preferences have encouraged insurers to deploy innovative ICT tools to assist them in sales, policy and claim management, finds new survey from Kable.

According to the survey of 132 insurers, 50% of insurers are planning to increase their ICT budgets in 2014, an increase of 18% compared to 2013. The survey data also reveals that insurers are planning to increase their ICT budgets both in software and IT services by 1%, reaching 23% and 18% of the overall budget allocation in 2014. With rising customer expectations and increasing competition, insurers need to upgrade their existing systems and adopt advanced technologies to improve their competitiveness. 

Kable’s research reveals that 95% of insurers are currently investing in security solutions to safeguard their customer data from cyber attacks, IP thefts and malware threats. Furthermore, 94% of insurers have already deployed various content management solutions in their organisations to deal with the massive amount of chronological and contemporary data. Meanwhile, 81% of insurers are currently using some form of cloud computing solution in their premises, and 83% of respondents are planning to invest in this area over the next two years. 

“Insurers aim to raise efficiency in order to stay competitive in the market,” says Renjitha Balkrishan, analyst at Kable. “The ICT investments strategy of insurers is also influenced by demonstrating the benefits of IT investment in business and using technology to support revenue growth.” For insurers the business area of core policy administration is the highest investment priority, with 51% of respondents considering it as one of their top three IT projects in 2014. Kable data also shows that advancements in technology and changing consumer and policyholder expectations have compelled insurers to re-invent their core policy systems such as claims management and policy-holder records.

Editor’s notes

The survey data is contained in Kable’s ICT investment trends in insurance industry market report, conducted in Q4 2013 via an online methodology, with respondents all having ICT decision making responsibility (typically CIOs and IT Managers).

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Insurers are planning to increase their ICT budgets in 2014.

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