Indian insurance companies will spend Rs 10,100 crore on IT products and services in 2013, a rise of more than 9 per cent over 2012.
This forecast includes spending by insurers on internal IT (including personnel), hardware, software, external IT services and telecommunications, according to a report by research and analyst firm Gartner.
The insurance companies had spent Rs 9,250 crore in 2012, it said.
IT services have overtaken telecommunications to become the biggest spending segment, and is forecast to reach Rs 3,060 crore in 2013, up from Rs 2,700 crore in 2012. IT services has achieved the highest growth rate amongst the top-level IT spending segments — forecast to exceed 13 per cent in 2013, with growth of 23.4 per cent forecast for business process outsourcing services. Consulting is also a high growth segment at over 18.2 per cent in 2013.
“We are continuing to see Indian insurers lead the charge on outsourcing and business process outsourcing,” said Derry Finkeldey, principal analyst at Gartner. “The Indian insurance industry is experiencing huge growth in transaction volumes, and Indian consumers are quite progressive in terms of seeking online and mobile services. Insurers are turning to experienced IT vendors to help them navigate the inevitable complexity this is producing.”
“The Indian domestic market for IT services is dynamic and highly competitive — with many of the leading names focused on the insurance sector and offering their own proprietary solutions to the industry. This competitiveness is ultimately great for insurance buyers,” Finkeldey added.