Insurance companies expect to spend slightly more on information technology in 2013 than they did this year, a report released by New York-based insurance advisory firm Novarica finds.

“U.S Insurer IT Budgets and Projects for 2013,” released Monday, is based on a survey of 102 insurance company chief information officers Novarica conducted in September.

According to the report, 29% of large property/casualty insurance companies and 40% of small/midsize property/casualty insurers expect their IT budgets to rise slightly in 2013, while 19% of each group expect their IT budgets to be much higher than 2012.

Conversely, only 10% of large insurers and 9% of small/midsize insurers said their budgets will be slightly lower in 2013, while 38% of large and 30% of small/midsize insurers expect their IT budget to remain level.

The survey also reveals that insurance CIOs are confronted with the challenge of simultaneously improving aging core administrative system while investing in a broader basket of emerging technologies.

“We still see a high level of core system replacement activity, in many cases continuing replacements begun in 2012 or earlier,” the report states. “But at the same time, insurers are moving forward to develop new analytical capabilities and start to invest more in emerging areas like mobile, social, cloud and big data.”

The report shows improving claims and policy administration are the top priorities for property/casualty insurers. For example, among large property/casualty insurers, 19% are in the midst of claims system replacement and 29% have a replacement planned for 2013, while 5% are planning to enhance an existing claims system.

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However, in the case, of business intelligence and data analytics capabilities, more insurers are opting to upgrade existing systems rather than replace them.

“While the majority of new systems implemented by insurers are bought rather than built (and have been for several years), it is important to note that major enhancement activity equals or exceeds replacement activity in many areas,” the report states.

When it comes to less mature technologies such as big data, most insurance companies are evaluating the technologies instead of deploying them. “Deployment rates for the underlying technologies to support big data are still extremely low,” the report states. “However, 20% to 30% of insurers do have pilot projects underway in big data areas.”