A newly-released report from New York-based Celent has foundthat senior information technology executives in insurance arefocusing on strategic spending to meet market demands.

In the fall of 2006, Celent, a research and advisory firm, saidit surveyed 29 senior IT executives with insurers to provide a deepinformation resource about priorities, behaviors, initiatives, andinfrastructures at U.S. insurers.

Overall, the respondents represented $50 billion in premium, orroughly 5 percent of the total U.S. insurance market, Celentsaid.

"There is continued focus on meeting market demands for speed tomarket and ease of doing business, and on new projects involvingcore systems, data mastery, and distribution," said MatthewJosefowicz, manager of Celent's insurance group.

Mr. Josefowicz, wrote the report titled "Insurance CIO/CTOPressures, Priorities, Projects, and Plans for 2007: SurveyResults."

"Budgets and staffs are generally flat or growing modestly, butstrategic investments continue," he noted. "However, there are someindications that large P-C insurers may be keeping their powder dryuntil they can gauge the impact of the softening market."

Celent also found that top areas of significant new projectspending vary by size and sector, but include initiatives focusedon underwriting, claims, product development, and data mastery.

"Document handling, policy administration system replacement,ACORD XML adoption, agent portals, and BPM all show up among themost common areas of significant new project spending," saidCelent.

In addition, the average insurer had approximately 15 serviceslive within its enterprise,

The study found about half of the sample is using Webservices/SOA for internal and external integration to enable newbusiness and underwriting, the researcher noted. ACORD XMLcontinues to play a role in more than half of theseinitiatives.

Celent added that the incremental mainframe migration iscontinuing, and Linux is becoming an important element of platformmodernization, along with Microsoft Windows. "While most largeinsurers rely on at least partially on mainframes for their corepolicy systems, the overall role of mainframes continues to wanegradually," said Celent.

The 56-page report covers a broad range of areas, includingdetailed budget breakdowns, staffing plans and ratios, and ananalysis of insurer activity in over 70 specific technologyinitiatives ranging from direct online sales to core systems tospecific deployments of business process management and documentmanagement systems, the researcher said.

Celent, LLC publishes reports identifying trends and bestpractices in financial services technology and conducts consultingengagements for financial institutions looking to use technology toenhance existing business processes or launch new businessstrategies.