Financial Services spending on insurance claims technology is expected to be driven by expense containment and customer experience requirements. Global spending on claims management systems is expected to increase significantly in 2015 as firms’ investment focus expands to developing markets for growth. The most profound change comes from increased spending in Asia and Pacific (up 17%) and Latin America and the Caribbean (up 20%).
Because of the maturity of the technology available in the market place, insurers are finding creative ways to bring in modern functionality. For some, replacing an entire core claims administration system is the best solution. For others, a full “rip out and replace” is not workable, but strategies around componentization and “unwinding” enable important new functionality. Not only do these initiatives facilitate expanded sales/service channel integration, but they also allow insurers to improve operations. This eases doing business for distributors and consumers, and removes unnecessary complexity.
As adoption of technology increases, the types of spending are expected to change. Wider adoption of vendor provided software over internally developed systems should shift spending to external sources. Increased spending on claims management software is projected to lead to increased spending on professional services for maintenance, upgrades and installation. Insurance carrier spending on professional services is expected to nearly double in the next five years, from US$481million (2010) to US$834 million (2015).
These estimates are part of a brand new initiative: TechSpend. The new research provides Financial Service Institutions’ spending forecasts in all major IT areas. Techspend forecast global spending broken down by region (North America, Europe, APAC, Latin America and the Caribbean and Middle East and Africa) and source of spending (internal, hardware, software, professional services and IT outsourcing) while also offering insights into the underlying growth drivers. Based on our expertise and bottom up approach to technology spend estimation, we identify and project the key drivers of units in operation and price for a technology.
Members can access the full TechSpend: Insurance Claims Management Technology to learn more: