Insurance in Russia: Market and IT Overview

by Nicolas Michellod, June 5, 2008

Abstract

Zurich, Switzerland 5 June 2008

The challenges faced by the Russian economy and particularly its insurance industry are numerous, but local companies have proved that they are eager to change and tackle the barriers to their success.

In a new report, , Celent discusses key drivers in the Russian insurance industry and how insurers should be positioning their IT to take on upcoming challenges. Along with its BRIC peers (Brazil, India, and China), Russia is expected to grow fast in the coming decades. Since the fall of the Berlin Wall and the end of the Communist era, Russia has made significant progress towards capitalism. Even though the country needs to carry on its structural reforms, the Russian economy is growing at a fast pace and is attracting an increasing amount of foreign investments.

Celent believes the future development of the Russian insurance market will depend on different factors such as new regulatory reforms, the persistence of mistrust and unawareness of insurance in the population, the propensity of the market to further consolidate, and the level of foreign investments. Regardless of the impact of these factors, Russian insurers will have to implement initiatives in order to gain competitive advantage in this changing environment. Insurers that can effectively improve their core processes, efficiently value new investments in IT, and form new strategic partnerships will emerge as the new leaders.

"With strong growth expected in the real life and non-life insurance sectors and the rapid development of bancassurance, insurance IT spending in Russia will almost double during the next four years," notes Nicolas Michellod, senior analyst with Celent’s insurance group and author of the report. "Core insurance processes in particular are still not efficiently aligned with companies’ goals and not supported by proper resources in terms of information technology."

This report looks in greater detail at the size and structure of the Russian insurance market and discusses salient IT trends.

The 30-page report contains 14 figures and 3 tables. A table of contents is available online.

Members of Celent's Insurance research services can download the report  

electronically by clicking on the icon to the left.  Non-members should contact info@celent.com for more information.

 

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

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Table of Contents

Zurich, Switzerland 5 June 2008

Executive Summary 3
Introduction 4
About Russia 6
The Russia Insurance Market 9
Market Growth and Drivers 15
Insurance and Technology 18
Technology Trends 24
Conclusion 27

 

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