North American Insurance Software Deal Trends, Property/Casualty Edition

by Karen Monks,  Michael Fitzgerald, June 4, 2013
Industry Trends
North America

Abstract

Insurance carriers have continued with their sluggish purchases of software, but 2012 shows a glimmer of hope for a turnaround.

In the report, North American Insurance Software Deal Trends 2013, Property/Casualty Edition, Celent analyzes deal data provided by software vendors active in insurance in North America. Deals for property/casualty software were flat compared to the last report, but a like-on-like comparison to the last two years’ results shows that many vendors saw a decrease in deals each year since 2010. The infrastructure and financial metacategory was a key driver of this report’s volume, as insurers increased their purchases of data mastery tools. When compared with the previous report, deal volume in this category rose by nearly 6%.

“Continued investment in core systems renewal was clearly reflected in property and casualty deal data,” says Mike Fitzgerald, Senior Analyst with Celent’s Insurance Group and coauthor of the report. “There was also an increase in data mastery tools, with P&C carriers competing in pricing and risk analytics. Once nice-to-haves, advanced analytics are becoming table stakes.”

“Our 2013 report shows that overall deal activity among P&C insurers continues to be slow. However, investments in core systems and data analytics have buoyed sales for key vendors,” says Karen Monks, Analyst with Celent’s Insurance Group and coauthor of the report. “Insurers picked up their software purchases as 2012 progressed, but deal volume is still well below volumes from three or four years ago.”

This report breaks down deal activity by carrier size, type of deal, four metacategories (core processing, distribution, infrastructure and financial, and document/content management), and a number of subcategories. Data from previous Deal Trends reports are used to look at longer-term trends, and leading vendors for each metacategory are identified. Based on vendor-provided data, the report also names leaders in the Celent Traction Index, which is an indicator of which companies are finding success in the insurance vertical.

The 26-page report contains 17 figures and four tables.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary

1

 

All Deals

1

 

Life/Annuity and Health Deals

1

 

Conclusions

2

Introduction

3

 

Methodology

3

 

Scope

4

 

Limitations

4

 

Categories Used

5

 

Carrier Tiers

8

Overview

9

 

Deals by Subcategory

10

 

Deals by Carrier Size

12

 

Life, Annuity, Health, and Property/Casualty

12

 

Deals by Customer Relationship Type

13

 

Deals by Relative Deal Size

14

 

Deployment Methods

14

Measures of Insurance Traction

16

 

Traction Leaders

16

An Improving Market—For Some

18

Property/Casualty Results

20

 

By Metacategory and Quarter

20

 

By Size and Metacategory

20

Property/Casualty Metacategory Leaders

22

 

Distribution

22

 

Document/Content Management

22

 

Infrastructure and Financial

23

 

Core Processing

24

Conclusions

26

Appendix: Vendors Included in This Report

27

Leveraging Celent’s Expertise

29

 

Support for Financial Institutions

29

 

Support for Vendors

29

Related Celent Research

30

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