Indian insurance companies' tech spend to touch Rs 11,700 cr in 2014

Indian insurance companies are expected to spend Rs 11,700 crore on IT products and services in 2014, a 5% increase over 2013, according to Gartner. This forecast includes spending by insurers on internal IT (including personnel), hardware, software, external IT services and telecommunications.

Indian insurance companies are on pace to spend Rs 410 crore only on mobile devices in 2014, up 35% from 2013.

"Gartner research shows that most Indian insurance CIOs view mobile enablement of applications and services as a very important component of their strategies to improve sales and channel effectiveness," said Derry Finkeldey, research director at Gartner. "This is especially important as insurers compete to reach agents and customers distributed across the country and outside of saturated urban markets."

The overall mobile device market in India is showing strong growth. For example, the nascent tablet market in India is projected to grow 160% in 2014. As the tablet market breaks through the 200 million rupee mark this year, growth is expected to be in the moderate double-digits range.

The much larger Rs 380 crore market for other mobile devices will grow 24% in 2014, with revenue of Rs 9.26 crore. While the Rs 1,100 crore mobile network services market is growing, its Rs 1,280 crore fixed network sibling is in decline, and will be overtaken in size by mobile spending by 2016.