Insurance: Tech Spending Aimed At New Products, Faster Claims Processing - InformationWeek
IoT
IoT
Software // Enterprise Applications
News
9/7/2006
07:15 PM
50%
50%
RELATED EVENTS
Dun & Bradstreet CAO Discusses Her Roll & The Skills Needed to Do the Job
Jul 26, 2017
LWhat does a chief analytics officer do each day? To help us answer that question we welcome Dun & ...Read More>>

Insurance: Tech Spending Aimed At New Products, Faster Claims Processing

Companies use Web services and business intelligence tools to cut costs and spot fraudulent claims

Insurance companies that specialize in property and casualty policies have struggled in the wake of last year's hurricane season, but those focused on health and life insurance enjoyed a profitable year. Both camps are using technology to cut costs, meet regulatory requirements, improve customer service, and deliver new products.

The industry's total IT spending as a percentage of revenue rose from 3.0% last year to 3.4% in 2006, yet it still remains below the 4% of revenue spent in 2002. A majority of insurers--64%--plan to increase their IT budgets, according to the InformationWeek 500 survey.

Much of the tech spending is aimed at deploying more nimble service-oriented architectures, Web services, and business intelligence tools. Some 69% of insurers have widely deployed Web services, and 79% have done the same with BI tools. Such tools can help cut costs through predictive modeling and digital dashboards that let claims managers identify processes that are slow and spot potentially fraudulent transactions, says Gartner analyst Annemarie Earley.

Insurers increasingly are working to differentiate their offerings, and 79% plan to develop new products and services this year. Look for creative products, such as Geico's mechanical breakdown insurance policy that protects policyholders after a car's warranty expires. Says Earley, "You're going to see more innovative products from this industry as companies strive to set themselves apart."

Top ranked company in this sector is Cigna, at No. 17.

Budget Breakdown

Tech Innovation

Inside Insurance
3.4% of Industry's Annual Revenue Devoted to IT
40% of IT Budget Devoted to New Projects
64% of Companies Expecting 2006 IT Spending to Exceed 2005


Business Change
79% Creating New Products/Services for Customers in 2006
14% with Global Supply Chain
45% Deploying Business Intelligence Tools to Raise Productivity



Return to the 2006 InformationWeek 500 homepage

Comment  | 
Print  | 
More Insights
Comments
Newest First  |  Oldest First  |  Threaded View
[Interop ITX 2017] State Of DevOps Report
[Interop ITX 2017] State Of DevOps Report
The DevOps movement brings application development and infrastructure operations together to increase efficiency and deploy applications more quickly. But embracing DevOps means making significant cultural, organizational, and technological changes. This research report will examine how and why IT organizations are adopting DevOps methodologies, the effects on their staff and processes, and the tools they are utilizing for the best results.
Register for InformationWeek Newsletters
White Papers
Current Issue
IT Strategies to Conquer the Cloud
Chances are your organization is adopting cloud computing in one way or another -- or in multiple ways. Understanding the skills you need and how cloud affects IT operations and networking will help you adapt.
Video
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Flash Poll