Indian insurance companies to spend Rs. 121 billion on IT in 2014

Indian insurance companies will spend 121 billion rupees on IT products and services in Fiscal 2014, a 12 percent increase over Fiscal 2013, as stated by Gartner, Inc. This forecast includes spending by insurers on internal IT (including personnel), followed by hardware, software, external IT services and telecommunications.

The 12 billion rupee software segment is projected to be the fastest external segment, growing at 18 percent in Fiscal 2014 overall, lifted by accelerated growth of insurance-specific software. IT services, the biggest spending segment for the insurance industry at 40 billion rupees in 2014, will continue to realise vigorous growth of 16 percent. Category leaders are business process outsourcing (BPO) at 25 percent and consulting – much of which relates to these insurance-specific application investments – at 21 percent.

“Insurers in India are getting serious about their core insurance processes, especially where they help increase insurer penetration of the market,” held Derry Finkeldey, principal analyst at Gartner. Rhetoricising further that –“While internal spending is also increasing, Indian insurers have been quick to turn to the competitive technology provider sector in India for guidance and delivery.”