Insurance carriers in the Asia Pacific are known for their reluctance to spend on IT but the latest report from IDC Financial Insights indicates a change in scenario. The increasingly challenging marketplace is encouraging insurers to forego the tendency to look inwards rather than outsource.
IDC Financial Insights is a research and advisory firm in the Asia Pacific. It is dedicated to help clients select or short-list vendors, assess their IT master plans, and devise business and operational best practices.
The firm says insurers in this region are becoming more aware of the benefits of outsourcing technology. They now realise the importance of outsourcing for competing in today's challenging marketplace.
Change driven by economic slowdown
The ongoing global economic crisis has given these insurers a major push towards IT outsourcing. These insurance vendors have realised how tough it is to survive in a changing business environment and understand the need to create a more dynamic business framework through the assistance of technology.
These findings are revealed in IDC Financial Insights' study "Insurance Vendors: Spotlighting the Major Players in Asia/Pacific." This document assesses the leading insurance technology vendors in this region.
This report focuses on three enterprise-wide technology firms: CSC, IBM and SAP, and six insurance technology firms: 3i Infotech, Cognizant, EAB Systems, eBao Technologies, Mastek and Perot Systems.
The study includes their strategic objectives; approach to product development, deployment and support; value proposition and competitive differentiation; market footprint and client profile; and, overview of major products. In addition, it provides IDC Financial Insights' assessment of the strengths and limitations of these vendors.
According to Li-May Chew, CFA, senior research manager for IDC Financial Insights Asia Pacific, each company has a unique value proposition, and compete through their different products, services and solutions.
While CSC is known for their large installed base with commendable end-to-end reach, IBM is appreciated for its high commitment level to the industry and vast ISV ecosystem of business partners.
"Among the InsTech organisations, 3i Infotech has a laudable front-end solution that addresses the full spectrum of insurance functions, and eBaoTech is viewed as being an aggressive company that has excelled at building brand awareness," added Chew.
The research and advisory firm suggests that insurers exploring IT outsourcing should be sure of their needs. This will help them find a solution that correlates with their requirements. Insurers should ask the vendor if they can customise the products according to their company and weigh the pros and cons of deploying multiple or one-system solutions. Insurers should also ask for reference clients.
Technology vendors looking to tap this emerging market should identify niche or underserved segments. It is helpful to know the current state of the insurance industry and its shifting client demographics. Vendors can be more successful in this market if the provide assistance to insurers in building agility and efficiencies. They should also be ready to help them manage their ecosystem of relationships. IDC Financial Insights suggest that they can achieve this by leveraging information with greater granularity and insight. All these efforts will ultimately result in smarter, more profitable business decisions.