U.S. life and health insurers could increase spending on computers, networks and related systems 36% by 2010.[@@]
An analyst at Celent Communications, Boston, has published that estimate in a forecast focusing on the U.S. insurance IT market.
U.S. insurers have been spending 2.5% to 3% of premiums on technology, according to Matthew Josefowicz, the analyst who wrote the report.
“Celent believes that, over the next 5 years, this will increase to between 3% and 3.5% as IT becomes even more essential to insurance company operations,” Josefowicz says.
In the short run, that means IT spending growth will keep pace with premium growth, Josefowicz predicts.
The modest increases could build up over time, with life and health IT spending rising to $21.2 billion in 2010, from $15.6 billion this year, and property-casualty IT spending rising to $20.8 billion, from $13.2 billion, over that same period.