Insurers to increase IT spending in 2003

Despite market pressures, North American insurers will spend 2% more on information technology (IT) in 2003, says a new report from Forrester Research’s Giga Information Group.The survey of insurance chief information officers (CIOs) shows that improving employee efficiency, agent efficiency and their company’s use of technology are priorities with the aim to increase profits.”The insurance company CIOs we talked with are primarily focused on incremental improvements, both to business operations – internally as well as with agents – and in their own IT activities and operations,” says Forrester vice president Andrew Bartels. “CIOs have gotten business support for increased IT spending focused on improving efficiency and increasing customer loyalty, but they are not pushing major new IT projects.”IT spending will be spread amongst software, with budgets up 5%, and network equipment and IT salaries, with budgets up 3% each. Hardware and outsourcing spending is flat, and consulting spending down.Security is an area of new spending, along with content and document management, and core transaction systems.Insurers are not adopting “leading-edge” technologies, the survey shows, which would include web services, portals and Linux systems. But they are using best practices for IT management, such as enterprise architecture and technology vendor management.