Most property and casualty insurance claims executives responding to a recent survey say they are not satisfied with their organization's capability of supporting for mobile computing devices but only a minority of respondents said their organizations have budgeted for increases in spending in this area.
Aite Group LLC of Boston conducted an online survey in May through August of 19 North American property and casualty insurance company claims executives. They were asked a series of questions on their information technology resources, including budgets, development initiatives and utilization of IT vendor services.
The results were published in a report, titled North American P&C Claims Executives and Claims IT Resources: Playing Shorthanded.
"Claims operations account for approximately 80% of property & casualty insurance company spending, but they receive only something on the order of 10% of total insurance company IT budgets," AITE Group stated in the report, which indicated there is heavy spending in other areas, such as legacy systems and policy administration.
The respondents were asked about their satisfaction with 12 areas of claims which are dependent on IT. While 69% were satisfied with their organizations' capabilities in catastrophe-related data management and 63% were satisfied with their ability to detect questionable claims, only 20% were satisfied with their capabilities in "customer-facing mobile solutions" and 25% were satisfied with their capabilities in "staff or agent-facing mobile solutions."
When asked about intentions for IT spending in 2013 in different categories of claims, only 15% said they expected their organizations to spend more next year on customer-facing mobile solutions and 23% said they expect to spend more on staff or agent-facing mobile solutions.
Aite Group noted the responses are "somewhat understandable given the recent explosion of (mobile) device adoption" but that the number of people using mobile devices is "growing exponentially" and insurance firms that "have to play catch-up will be competitively disadvantaged."
The report noted it is not surprising that a high percentage of claims executives are satisfied with their capabilities around managing data related to catastrophes.
"These events, while unpredictable, disruptive and costly, generate only a small fraction of all claims received by these carriers, and specialty technology vendors have developed specialized and effective solutions for use by carriers," according to the report.
Thirty-one per cent of respondents said they expect claim IT spending to increase in the areas of integration with third-party vendors and detection of questionable claims.
Aite Group also asked respondents which IT services vendors they "generally" use in claims and accepted multiple responses.
The second-most used supplier indicated, at 40%, was their own internal IT department, while 47% indicated Oracle Corp. In third place was Accenture, at 27%, while 20% each indicated IBM Corp., Fiserve and Ernst & Young. Eighteen other vendors were also named, by 13% or 7% of respondents.
"Given the structure and size of the research sample, the data in this report provide a good directional indication of conditions in the market," according to AITE Group.