If insurance analysts didn't invent the term cautiously optimistic, they should have. A viewpoint expressed often, it's as important a part of the lexicon at this time of year as "Happy New Year." IT budgets appear to be headed up, if only slightly, and considering the fact the property/casualty insurance industry is dealing with a softening market, there could be worse news for insurance IT leaders.
Craig Weber, managing director of Celent's insurance practice, finds there are exceptions on each end of the spending scale, though. "If you look at responses to our CIO survey, there are hot wires on either end of that scale, so you could be looking at a 10 percent budget decrease or a 15 percent budget increase at individual companies," he says. "Overall, I think the industry is two to three percent on the rise."
Larry Danielson, principal with Deloitte Consulting, also contends IT budgets will see slight increases for 2008. "We really don't see a big increase," he says. "People are focused on the growth topics." The wild card for the industry this year, in his opinion, involves regulatory issues. "Even though a lot of people talk about being prepared and doing the right thing from a regulatory perspective, I think they largely wait to the point where they might have a problem," he says. "If there are surprises this year, that's where we'll see them."
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