Highest spending expected to be on insurance-specific offerings
Asia-Pacific insurance carriers IT spending is expected to increase by 10% to 20% in 2011 as compared to 2010, according to a regional survey by IDC.
The survey revealed that insurers will spend most on insurance-specific offerings such as distribution channel management systems or core insurance applications like policy administration, underwriting, claims and billing.
The report named ‘Business Strategy: Issues and Initiatives of Regional Insurers – A 2011 Executive Survey’ highlighted that core system enhancements continue to be top of mind, given that some carriers, especially those in emerging Asia, are still struggling with outdated technology.
The research firm said that more insurance carriers are focusing their attention on creating/enabling a more flexible, dynamic IT infrastructure through the adoption of Software-as-a-Service (SaaS), Platform-as-a Service(PaaS) or Service-oriented architecture (SOA) so as to reduce capital expense (CapEx).
IDC financial insights Asia/Pacific financial advisory service associate research eirector Li-May Chew said the IT delivery/consumption models resonate with insurers as they are able to break the shackles of traditional technology purchasing methods by leveraging on the concept of shared infrastructure and services, leading to lower costs, higher flexibility, and better business agility.
"In fact, when it comes to such adoption, Japan seems to be blazing the trail in cloud computing within the Asian insurance space with institutions like Sompo Japan Insurance, Sumitomo Life Insurance, and Nippon Life Insurance leading the pack," Chew said.