Indian insurance companies to spend $566 million on telecom in 2012

Indian insurance companies will spend $1.8 billion on IT
products and services in 2012, an increase of 11.7 percent over 2011 revenue of
$1.6 billion, according to Gartner.

This forecast includes spending by insurers on internal
IT (including personnel), hardware, software, external IT services and

Telecommunications represents the biggest spending
category, and it is forecast to reach $566 million in 2012, up from $512
million in 2011.

However, spending on IT services is expected to grow the
fastest in 2012, with revenue totaling $447 million in 2012, up 15.8 percent
over 2011 revenue of $386 million.

Indian insurers are faced with an opportunity to
transform significant aspects of their operations via technology, right across
the entire insurance business value chain.

Indian insurers have shown themselves to be particularly
forward with regards to considering alternative delivery models such as
business process outsourcing,” said Derry Finkeldey, principal analyst at

External factors, such as regulatory change, uncertain
economic conditions and the increasing frequency of catastrophic events, are
forcing insurers to reassess their approaches to business processes and the IT
applications that enable them to derive greater efficiency and achieve more
with less,” Finkeldey added.

Insurers are looking for ways to streamline their
processes from the front office to the back office, and are investing in the
next generation of core solutions to help them do that. These solutions often
integrate business process management (BPM) and analytics capabilities, or are
offered in an ‘as a service’ model.

By Team
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