NU Online News Service, Dec. 4, 11:25 a.m.EST

If the results of a survey of North American property andcasualty insurers hold true, 2010 should be a year of growth forinformation technology in the industry, according to Deb Smallwood,founder of Strategy Meets Action.

Results from the survey conducted by SMA show three quarters ofcarriers believe their enterprise either will grow or sustain theirposition next year.

"Insurers are really looking at growth strategies [for 2010],"Ms. Smallwood said. "They plan to spend aggressively on technologysolutions."

Ms. Smallwood and two of her partners at SMA, Karen Furtado andMark Breading, presented the results of the survey and theiranalysis during a Web seminar: "Riding the Wave: Insurer TechnologySpending, Drivers and Approaches for 2010 and Beyond." The Webinarwas conducted by Tech Decisions for Insurance andNational Underwriter.

In looking at the top drivers for technology spending, Ms.Furtado reported that business growth was cited as the top driverby 66 percent of respondents. This was followed by both businessprocess optimization and cost containment/expense reduction, eachof which was cited by 56 percent of respondents.

"These drivers reflect the need to strengthen processes and staycompetitive," Ms. Furtado said.

The survey indicated that 37 percent of insurers will increaseIT spending in 2010, with 36 percent expecting IT budgets to remainflat.

Twenty-one percent reported their IT spending will decrease,with 4 percent expecting a significant decrease in spending of 10percent or more, and 1 percent reporting a significant increase inspending of 10 percent or more.

"This indicates a belief that technology investment is essentialto remaining competitive in today's marketplace," Ms. Furtado said,adding, "The health of the [IT] market shows the industry is verystrong."

Ms. Furtado indicated the trend revealed in this survey is thatmarketing and product development will be the top priority for 2010and beyond. Investments in this area include purchase of externaldata and use of predictive analytics and business intelligencetools, she noted.

"Competitors are finding ways to attract customers, whetherthrough price or service," Ms. Furtado explained. "Brand loyalty isnot what it was in the past."

Ms. Smallwood's message for insurers is that IT spending is aninvestment--not just a cost--but that there is no room formissteps. She also advised carriers to develop a strategic plan forthe business, including a road map.

"[A road map] needs to be for three- or five years," she said."It has to go beyond just legacy replacement."

As for IT solution providers, Ms. Smallwood said she believesthe industry is "crying for solutions that are easy to implementand easy to integrate."

For access to this free Web seminar, go to www.tech-decisions.com/webseminars.

Robert Regis Hyle is associate editor atTech Decisions For Insurance, part of Summit BusinessMedia's P&C Magazine Group, which includes NationalUnderwriter.