Insurers in Singapore will spend an estimated US$450 million on technology in 2014, while those in the Asia-Pacific region will spend an estimated total of US$18.1 billion, according to IT consulting firm IDC Financial Insights.
The US$18.1 billion spending by regional insurers is based on a projected 5.6 per cent increase from this year, driven mostly by insurers from emerging nations such as China, India, Indonesia and Malaysia.
For this region, IDC forecasts the top three areas of spending to centre around e-channel strategies for online, mobile and social media; core applications management (for example, for claims and product development); and business analytics and customer relationship management (CRM) applications.
"Spending for Singapore will largely be around an urgent need to craft a more customer-centric strategy to upsell offerings to typically underinsured Singaporeans, and a focus on online, social media and mobile initiatives," Li-May Chew, associate research director for IDC's worldwide insurance advisory services, told BT yesterday.
She added Asian insurers increasingly understand that business-as-usual operations will no longer suffice and that they will need to transform to remain relevant. They have thus become more generous in allocating resources to technology.
In another report titled Global Insurance 2014 Top 10 Predictions: Future- Proofing the Business, IDC highlights key insurance trends for 2014 which they say will assist insurers in future-proofing their businesses, and financial technology vendors in prioritising their development activities and repositioning their offerings.
Said Ms Chew: "Getting their organisations future-ready means needing to reinvent business processes to dramatically reduce cost; enhance the digital outreach; and explore disruptive innovation within the mature markets of Singapore, Australia, Hong Kong, Taiwan and South Korea."
Globally, technology spending is projected to rise to US$101.6 billion in 2014.