IT Spending in Insurance: A Global Perspective, 2016

by Karen Monks,  Jamie Macgregor,  Juan Mazzini,  KyongSun Kong, April 27, 2016
Industry Trends
Global

Abstract

Celent estimates that, globally, insurance IT spending will grow to US$184.9 billion in 2016, with continued growth to US$208.1 in 2018 — a CAGR of 6.1%. This upward shift is above last year’s estimates and is the result of increased premiums in most regions and efforts to keep competitive in a digital market.

In the report IT Spending in Insurance: A Global Perspective, 2016, Celent analyzes IT spending trends across North America, Europe, Asia-Pacific, and Latin America. The report compares and contrasts the direction of IT spending trends. The growth is spread across the regions at various levels, with North America and Latin America seeing the highest growth rates.

European and North American financial institutions currently account for 74.6% of global IT investments by insurance companies. Firms in the Asia-Pacific region account for 18.7%, Latin America accounts for 4%, and the Middle East / Africa / Commonwealth of Independent States account for the balance.

“As with 2015, IT investment continues to be targeted towards profitable growth, with IT investment continuing to rise,” says Jamie Macgregor, senior vice president of Celent’s insurance practice and coauthor of the report. “However, unlike last year, there is leveling off of expenditure in some territories owing to the perceived fragility of the macroeconomic environment.”

“Life insurers are harder hit,” says Karen Monks, an analyst with Celent’s insurance practice and coauthor of the report. “Low interest rates in developed markets continue to take their toll. Bright spots remain with the continued investment in digital across both P&C and Life, and core systems transformation to drive improved market responsiveness.”

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].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary

1

 

Key Research Questions

1

Introduction

3

 

Key Research Questions

3

 

Global Insurance Market

3

 

Definition of IT Spending

4

The Insurance Industry Global View

6

 

Top Technology Trends

7

North America

11

 

Snapshot

11

 

Top Trends

13

Europe

16

 

Snapshot

16

 

Top Trends

18

Asia-Pacific

21

 

Snapshot

21

 

Top Trends

23

Latin America

28

 

Snapshot

28

 

Top Trends

30

Rest of the World

36

Conclusion

37

Leveraging Celent’s Expertise

38

 

Support for Financial Institutions

38

 

Support for Vendors

38

Related Celent Research

39

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