Total IT spending from insurers around the world will hit $101bn this year, representing a 4.4% growth rate from last year, according to the latest research from IDC.
The IDC Financial Insights study put the growth down to investments in the latest technologies, as legacy systems become increasingly complex, inflexible and costly.
Investments are expected to focus on data warehousing, new applications, claims and policy administration systems, with the aim of boosting efficiencies and innovation.
"Global insurers need to know where and how to seek pockets of growth amidst economic uncertainty," said Li-May Chew, CFA, associate research director at IDC Financial Insights.
"We expect the global insurance industry to invest more rigorously in technologies, and project global IT investments rising to almost US$101 billion this year as these support campaigns to boost efficiencies and innovation."
The research also claims that insurers will have to invest $3.3bn on information security to counter fraud and other financial crimes.
"In order to regroup and focus on sustainable, profitable growth, organisations will have to confront multiple perils – ranging from reengineering or rebuilding legacy applications, to countering mounting insurance fraud – and still ensure they are well positioned to embrace growth prospects as these present themselves," said Chew.
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