The majority of insurance companies are planning modest increases to their IT budgets, according to the US Insurance IT Budgets and Priorities 2014 report from insurance technology analyst firm Novarica.
Written by managing director Matthew Josefowicz and based on responses from 100 companies, the report says that the higher budgets are hitched to expected increases in premium -- indicating a focus on growth in the industry.
"Growth and operational effectiveness continue to be the top strategic goals driving insurer IT budgets, with competitive parity also ranking highly," Josefowicz wrote.
[Related: Growth mandate at United Insurance]
While much of the technological priorities identified by insurers are the "usual suspects" -- policy administration and other core systems are being replaced, while portal capabilities are being enhanced -- the survey found that insurers -- especially the largest P&C carriers -- are making heavy investments in big data and analytics. Twice as many large property/casualty insurers are deploying, piloting, or planning to pilot big data technology tools than in last year's study, according to Novarica.
"While most groups' deployment and pilot rates are roughly the same as in the prior year's survey, the rate for large property/casualty insurers has approximately doubled across all areas of big data," Josefowicz writes. "Although the sample sizes for life/annuity insurers is comparatively small, the number of large companies citing BI and analytics in their top three priorities jumped from 40% in last year's study to 60% this year, reflecting a general increased focus across the industry on these areas."
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