During the 1990s, spending on IT, both in insurance and in general, grew steadily. Since 2000, however, the trend has been toward flat or declining budgets. Many valid reasons have been offered for the slowdowna weak economy, concerns about terrorism, the bursting of the dot-com bubble, and the end of Y2K-inspired spending.

There is another factor that has not been given enough attentionmanagement has lost some of its faith in the ability of IT to deliver reliably worthwhile results. In this case, the pain is self-inflictedIT projects have earned a poor reputation by failing too often to meet expectations.

IT professionals should not wait for the economy to recover and assume that funds will flow freely again. A proactive effort is needed to convince management that investing in IT is the appropriate response to many of the problems a company faces. Executives must be convinced this time the rate of success of projects undertaken will be higher and the promised returns will actually materialize.