Core Systems Turn Over & Vendors Look to Add Capabilities, Cautious Approach to Smart Devices, P/C Ratings Upgrades, Global P/C Insurance Rate Declines
INN: As Core Systems Turn Over, Vendors Look to Add Capabilities
A saturated core systems market and software providers’ willingness to add missing pieces to core suites through acquisitions has led to a major uptick in vendor M&A activity, experts say.
Though adoption of new core products is expected to remain steady through 2017, according to research from Celent, the consensus is that trend is dying down. As a result, software providers have turned to selling ancillary products around core suites to generate revenue and improve user experience. Recent acquisitions by Guidewire Software of EagleEye Analytics and FirstBest Systems; as well as Duck Creek’s buy of Agencyport, are prime examples, according to Celent research director Karlyn Carnahan.
“With the core systems market shrinking, vendors have entered new niches, resulting in greater product portfolios and applications,” said Carnahan. Read the full article now…
INN: Home Insurers Take Cautious Approach to Smart Devices
The property and casualty insurance industry is taking a closer look at the potential for smart home devices. Observers expect that smart homes will have a similar effect on home insurance that telematics and the connected car did for auto insurance. Soon, carriers aim to use connected-home technology for claims avoidance, underwriting and improved interactions with homeowners beyond just creating a policy. That’s according to new research from technology-research firm Gartner. And, some insurers are beginning to invest in connected-home companies using their internal venture capital arms.
But there are still obstacles in the way of fully realizing smart homes’ potential. Unlike telematics in auto insurance, there is no set standard yet of how to leverage data insurers collect from households, according to Kimberly Harris-Ferrante, distinguished analyst at Gartner. Customers are also not adopting smart home technology as quickly as the industry would like. As a result, insurers have adopted a wait and see approach as more tech trickles out from incubators and startups.
“This is the future of insurance, but carriers have to figure out the partnership model, how to make use of the data and how to actually get the device in the consumers’ hands,” Harris-Ferrante says. Read the full article now…
Carrier Management: P/C Ratings Upgrades, Positive Outlooks Outpaced Negative in H1: A.M. Best
Property/casualty insurers can take comfort in the fact that ratings upgrades and positive outlooks outpaced downgrades and negative outlooks through the first half of 2016, according to a new A.M. Best report.
But most of the issuances – affirmations – were essentially on par with the same period in 2016.
A.M. Best said that upgrades were 6.9 percent of total rating actions in H1 2016, downgrades were 5.4 percent, under review companies were 4.4 percent of the total and initial ratings encompassed 2.1 percent.
Over the same period in 2015, upgrades encompassed 4.7 of the total, downgrades were 7.4 percent, under review companies were 3.5 percent and initial ratings came in at 1.8 percent. Read the full article now…
Carrier Management: Global P/C Insurance Rate Declines Slowed Again in Q2: Marsh
The state of global insurance rates in the 2016 second quarter is very much a mixed bag. On the one hand, global insurance rates declined for the 13th consecutive quarter. However, this is the second quarter in a row that the rate of decline has slowed on average, Marsh said in its latest Global Insurance Market Quarterly Briefing.
For Q2, global insurance rate decreases moderated to 3.6 percent versus 3.8 percent in the previous quarter.
Broken down by sector, the global casualty renewal rate dipped 2.9 percent during the 2016 second quarter; the global property renewal rate declined an average 4.5 percent; and the global FinPro renewal rate declined by 3.1 percent, Marsh said. Read the full article now…