Virginia-based Computer Sciences Corp. (CSC) announced that it has inked an agreement with Zurich-based Swiss Reinsurance Company Ltd. Financial terms were not disclosed.
Per the agreement terms, Computer Sciences will host and manage a couple of insurance software applications for Swiss Re. With the help of these software applications, Swiss Re will be able to support its North American Corporate Solutions business.
Computer Sciences will host its flagship ‘POINT IN’ insurance administration software; ‘AWD’ business process management software; Advanced Claims software and Agency Link real-time Web portal for agents. Leveraging Computer Sciences’ secure and trusted insurance software support, Swiss Re will now be able to focus more on its business growth in North America.
Swiss Re has been using Computer Sciences’ insurance products since 1995. The duo had then signed a business process outsourcing agreement, under which Computer Sciences is required to provide extensive insurance processing support to Swiss Re within the U.S. The contract was extended for 10 years in 2003, under which Computer Sciences extends insurance processing support to Swiss Re’s U.K. operations. The current deal between the two demonstrates the reinsurer’s trust for the world renowned tech solution provider.
Computer Sciences has witnessed a series of insurance deals in the past few months, indicating the efficacy and popularity of its products. In May, the company introduced a new cloud-based business process service. We expect this new service to attract more deals from the insurance sector.
However, Computer Sciences’ fourth quarter 2011 results were mediocre, due to delay in the NHS contract. We are also concerned about intense competition in the IT and cloud computing space from both small and big players such as Accenture plc (ACN) and Hewlett-Packard Company (HPQ). Moreover, delays in NHS contracts and fewer government deals due to regulatory spending cuts are making matters worse for Computer Sciences.
Currently, Computer Sciences has a Zacks Rank of #5, implying a short-term Strong Sell recommendation.
