Calcutta, Jan. 23: Domestic insurance companies are expected to spend Rs 10,101 crore on IT services and products this year against Rs 9,250 crore in 2012, according to research firm Gartner.
This will contribute to a 9 per cent year-on-year rise in IT revenues.
According to the forecast, insurers are likely to step up spending on IT, which includes personnel, hardware, software, external IT services and telecommunications.
“We are continuing to see Indian insurers lead the charge in outsourcing and business process outsourcing. The insurance industry is experiencing a huge growth in transaction volumes, and consumers are quite progressive in terms of seeking online and mobile services. Insurers are turning to experienced IT vendors to help them navigate the inevitable complexity this is producing,” said Derry Finkeldey, principal research analyst at Gartner.
The research firm said insurers were spending more on IT than telecommunications.
IT services expenditure is set to grow 13 per cent to Rs 3,060 crore in 2013 from Rs 2,700 crore last year.
It is likely to witness the highest growth among the top-level IT segments with business process outsourcing services expenditure forecast to grow 23.4 per cent this year.
According to Finkeldeymany of the leading names in information technology are focusing on the insurance sector and offering their own proprietary solutions to the industry.
“This competitiveness is ultimately great for insurance buyers,” he said.
Consulting, which is expected to grow 18.2 per cent in 2013, also has the potential to be a high-growth segment in insurance.