That frugality is what enabled insurers to come through the recession less bruised than the banking industry, according to Ms. Carney.

“What I mean by [inspired frugality] is the insurance industry, when it came to replacing [any] technology, decided to use it up, wear it out, and make do,” she said.

If tools still were working, insurers stayed with them, even if the tools had reached the end of their depreciation life, Ms. Carney added.

That strategy will not last much longer, she predicted.

“I think there is going to be a catch-up when the market definitely turns around and carriers take [replacement projects] off the back burner,” according to Ms. Carney.

At that point, however, which kind of security will be the focus seems unclear–insurers have not shown interest in investing in any specific security technology, in Ms. Carney's view.

“[Insurers] are in the midst of upgrading core applications, and they are moving [processes] online,” she reported.

Fraud identification also falls into the security risk area, added Ms. Carney, as well as identity management, vulnerability management, and data security.

“These are all areas [insurers] need to invest in,” she said.

Banks have more security issues to deal with than insurers simply because banks are where the money is, according to Ms. Carney.

“Security threats around insurance involve identity theft, fraud, data theft, and those kinds of things,” she noted.

Banks are bearing the brunt of the attention from regulators on online security issues, pointed out Ms. Carney.

“[Insurers] lagged the banks in terms of moving online by six or seven years,” she said. “The same kinds of [security tools] banks bought a few years ago are what insurance carriers are implementing. Anything to secure that online transaction is a key investment right now.”

Robert Regis Hyle is Editor In Chief of Tech Decisions for Insurance, part of Summit Business Media's P&C Magazine Group, which includes National Underwriter. See www.tech-decisions.com for more information.