Indian insurer are forecast to spend Rs 14,960 crore on IT products and services next year, an increase of 9.1 percent over 2016, research firm Gartner said today.
The forecast includes spending by insurers on internal IT (including personnel), hardware, software, external IT services and telecommunications.
Wages growth and increased competition for skills in the market is driving increased costs for insurers and opportunity for IT services providers, Gartner said.
The highest growth category for IT spending in 2017 is expected to be IT services, which is forecast to grow over 15 percent compared to 2016 and reach over Rs 4,900 crore.
Internal spending by insurers on their IT talent is forecast to increase by nearly 10 percent in 2017, Gartner said.
"We are seeing insurers grapple with the challenge of finding, attracting and retaining specialist IT skills particularly in high demand areas like analytics, mobility and security all around the world, and the Indian insurance market is also experiencing this tension," Gartner research director Derry Finkeldey said.
The ability to attract skilled professionals represents a competitive advantage that insurers must plan to achieve, she added.
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