IT Spending Trends in European Insurance

July 31, 2003

Abstract

Paris, France Milan, Italy July 31, 2003

IT Spending in European Insurance

Celent estimates that European insurance carriers will spend  € 21.7 billion on information technology in 2003, reaching € 22.3 billion by 2004.

In a new report, , Celent examines the European insurance industry, taking a close look at the insurance markets in the following countries: France, Germany, Italy, Spain, Switzerland, and the UK. These countries account for 80% of the total IT spending in Europe. The study includes strategies achieved by IT, distribution methods, IT spending, and examples of IT projects at insurance firms. Celent’s study concludes with a discussion of the future of the European insurance market.

The last two years of turbulent economic conditions have almost irreparably damaged the entire financial services industry. In particular, reduced activity in the capital markets had a substantial impact on the entire financial sector. Falling interest rates and the collapse of stock prices had a significant negative effect on insurance companies and investors. These conditions led major market players to take more measured approaches to IT investments, focusing especially on strategies to reduce costs.

"Despite decreases in overall IT budgets, European insurance companies are still pursuing new projects," comments

Axel Pierron, Celent analyst and co-author of the report. "Interestingly, top insurance firms are using different strategies to reach their objectives. Many carriers are taking a more industrial approach to gaining efficiencies. They will eventually integrate successful IT projects into all their different lines of business."

"Insurance companies’ goals with new technology are to improve customer service and enable cross-selling, and to cut costs," adds Isabella Fonseca, co-author of the report. "Insurance firms are focusing their attention on a number of technologies to meet these goals, including customer management, risk management, and claims management systems."

The 36-page report contains 18 figures and 5 tables.

A is available online.

of Celent Communications' Property/Casualty Insurance and Life/Health 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.

        

Send mail to info@celent.com with questions or comments about this Web site.

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

 

Paris, France Milan, Italy July 31, 2003

IT Spending in European Insurance

Return to report Abstract

 

EXECUTIVE SUMMARY 3
OVERVIEW OF EUROPEAN INSURANCE 4
  Insurance Breakdown 4
  Geographic Location 6
  Insurance Trends and Implications on Technology Investments 8
  Insurance Distribution Methods 10
APPROACH TO INFORMATION TECHNOLOGY 12
  Insurance Life Cycle 12
  Strategies Achieved by IT 13
COST REDUCTIONS 16
  Centralization of IT Operations 17
  Outsourcing 20
  Streamlining of Processes 20
IT SPENDING ESTIMATES 23
  Definition of IT Spending 23
  Total IT Spending 23
  IT Spending by Country 24
IT BUDGET ALLOCATIONS 26
  Spending Breakdown 26
  Life/Health v. Property/Casualty 28
  Information Technology Projects 30
LOOKING FORWARD 34

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