January 2018 - IT is the largest single expense area for insurers besides claims and commissions. Given its intangible nature, it’s also the area whose value is questioned most often. IT Financial Management (ITFM) is the practice of managing, optimizing, and demonstrating the value of these costs. In many insurance organizations, the practice of ITFM is immature, which leads to internal management conflict and lack of agreement about IT value.

In this report, Novarica introduces a new framework, the Novarica IT Financial Management Maturity Model. This four-stage, seven-dimension model enables an organization to determine both its current and desired levels of maturity as it considers the evolution of its ITFM capabilities.

IT Financial Management is neither free nor easy. It requires dedicated resources, coordination across the enterprise, leadership, and commitment. But it also has the potential to lower costs, improve ROI, and demonstrate IT value.