North American Insurance Software Deal Trends, Life/Annuity/Health Edition

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

Abstract

Insurance deal activity grows with increased investments in sales and distribution software.

In the report, North American Insurance Software Deal Trends 2013, Life/AnnuityHealth Edition, Celent analyzes deal data provided by software vendors active in insurance in North America. A close look at overall 2011 and 2012 deals that fall into each metacategory and subcategory shows that insurance carriers have continued with their sluggish purchases of software, but 2012 shows a glimmer of hope for a turnaround in the market. Deals for life/annuity/health insurance software in 2012 grew compared to 2011, and a like-on-like comparison to the last two years’ results shows that most vendors saw increases in deals since 2010 as well.

“Continued investment in core systems renewal was clearly reflected in the life/annuity/health deal data,” says Mike Fitzgerald, Senior Analyst with Celent’s Insurance Group and coauthor of the report. “Package software activity indicates that insurers are using specific applications such as rules engines and front-end solutions to surround legacy administration systems.”

“Distribution deals increased dramatically in life, and account for 27% of all deals, up from 15% in our last report,” says Karen Monks, Analyst with Celent’s Insurance Group and coauthor of the report. “Our conversations with life insurers reveal that many are concentrating heavily on improving the sales and distribution process through automation; the deal data supports this trend.”

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 subsidiary 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

11

 

Life, Annuity, Health, and Property/Casualty

12

 

Deals by Customer Relationship Type

13

 

Deals by Relative Deal Size

13

 

Deployment Methods

14

Measures of Insurance Traction

16

 

Traction Leaders

16

An Improving Market—For Some

18

Life/Annuity and Health Results

20

 

By Metacategory and Quarter

20

 

By Size and Metacategory

21

Life/Annuity/Health Metacategory Leaders

22

 

Distribution

22

 

Document/Content Management

22

 

Infrastructure and Financial

23

 

Core Processing

23

Conclusions

20

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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