I’m attending the annual ISOTECH conference, held this year in Las Vegas, where a conversation that’s come up repeatedly in my discussions with technology companies exhibiting at the show is what impact the current economic situation might have on insurance industry IT investment.
It’s understandable to think that in the face of current economic challenges, companies might be unwilling to take on sizable expenditures.
But, it seems a case can be made for wise investments in areas that are ultimately likely to reduce costs such as claims systems.
Several recent studies have shown that in fact insurers do seem to recognize that rather than representing a prudent cost cutting strategy, not making necessary IT expenditures because of the current economic climate is actually a bad bet.
In particular, studies from the Property Casualty Insurers Assn. of America and Gartner Inc., Datamonitor P.L.C. and Celent have shown companies directing their IT spending to areas that support business growth, risk management and compliance and in technology that helps them reduce costs, increase revenue and make better use of data.
That sort of selective IT spending seems like the smart play.