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, IT Spending Trends in European Insurance, 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."
