The report discusses in some detail applications for the smartphone, digital pens and other developing technology.

Celent said while the business case behind many of these initiatives is unclear, innovation requires a leap of faith, more in some areas than others.

There remain several unknowns in all the initiatives, such as consumer behavior in social networking or adoption rates of smartphones and their applications. Few of the initiatives in this report are able to create a high impact on the business process today, the firm asserted.

"There will be leaders and followers in innovating business processes," noted Nicolas Michellod, senior insurance analyst and coauthor of the report. "[Chief executive officers] and [chief information officers] need to be clear on which category they want to be in. Leaders could reap benefits for early investment in an innovation that gains broad acceptance, but could also bear the costs with minimal benefit if it does not work."

Celent said that despite flat budgets going into 2010, its research shows a remarkable number of insurers that have or are considering launching products or channels during this recession.

Among some of the innovations:

o Leveraging Smartphones: The last few years have seen the adoption of smartphones increase dramatically, as well as a shift from business use to personal use.

Adoption rates by country vary considerably with the United States holding a 17 percent penetration level.

Two U.S. insurers' utilization of iPhone technology is aimed at policyholders.

The Nationwide Claims application is aimed at clients and prospects alike. Farmers iClaim application offers similar functionality for the motorist and for the homeowner.

American Family, another U.S. P&C insurer, goes a step further and offers the claims applications for both iPhone and BlackBerry devices.

o Digital Pens: These devices offer an alternative to empowering the remote workforce and address issues of connectivity and cost. Through a combination of a digital pen and a smart form, efficiency of the new business process can be improved. Business benefits are multifold, including capturing the data once, validating the data at source, speeding up data submission and the overall process.

The report also looks at marketing with social media and the advent of virtual worlds and digital assistants and how insurers will incorporate these technologies in the future.