Guidewire Software GWRE announced that the company’s InsurancePlatform suite of products have recently been selected by The Commonwell Mutual Insurance Group to enhance customer experience.
Ontario, Canada-based The Commonwell is the mutual insurer of automobiles farm, residential, and small commercial. The company, which has been operational for more than a century, was formed by the merger of three legacy companies that bonds a “common” history and mutual values.
Per the agreement, “Guidewire systems will run as a part of Deloitte’s InsurCloud, a cloud with implementation, ongoing services, and support from Deloitte, a Guidewire PartnerConnect Consulting Premier member.”
Moreover, The Commonwell opted for Core and Digital products of InsurancePlatform to accelerate claims management processes. The Commonwell intends to substitute the preceding systems with InsurancePlatform solution across its business lines. The solution is designed to benefit insurers with streamlined claims management processes, enabling them to bolster operational efficiencies.
Notably, InsurancePlatform is a P&C industry platform, which is deployed through Guidewire Cloud joining software, services, and partner ecosystem to customer business. The solution aids in reducing risk via increased productivity, bringing speed to market, digital engagement and simplifying IT infrastructure.
Notably, increasing adoption of technologies like AI, robotic process automation, cognitive intelligence or blockchain calls for a best-in-class technology to address customer needs. Guidewire’s InsurancePlatform solution is aiding The Commonwell’s customer-centric business model to improve insurance processes.
With the synergies of the recently selected offerings and access to Guidewire’s Marketplace, The Commonwell anticipates to provide innovative solutions and adapt to changing market demands.
We believe that rapid adoption of Guidewire’s solutions will aid the company in bolstering subscription revenues, consequently enabling it to expand total addressable market or TAM.
Share Price Movement
Shares of Guidewire have returned approximately 16.2% in the past year, significantly outperforming the industry’s rally of 4.5%.
Adoption of InsurancePlatform: Key Catalysts
Guidewire’s cloud-based subscription products are gaining traction as insurers are increasingly looking to digitally transform their business processes.
Moreover, the company has increased investments to enhance insurance software products via collaborations with leading on-demand cloud infrastructure vendors including Amazon’s AMZN cloud computing platform, Amazon Web Services (AWS) and Microsoft MSFT Azure.
Furthermore, the company added six additional InsuranceSuite Cloud customers, in the last reported quarter, which is noteworthy.
Expanding clientele comprises a wide range of customers that utilize multiple components of Guidewire offerings. For instance, Amerisafe AMSF uses Guidewire Underwriting Management, while Amerisure Mutual Insurance Company and Westfield Insurance have deployed ClaimCenter, to mention a few.
The company’s acquisition strategy is also a major contributor to growth. The buyouts of Cyence, ISCS (now called InsuranceNow), FirstBest (now called Guidewire Underwriting Management) and EagleEye Analytics (now known as Guidewire Predictive Analytics) are not only aiding revenue growth but also helping the company to expand clientele.
Guidewire’s initiatives to enhance offerings via product enhancements, inorganic strategies and collaborations and partnership programs are enabling it to expand clientele. This bodes well for the top line.
However, increasing investments are likely to weigh on the bottom line, at least in the near term. Moreover, buyouts pose integration risks, which remain a concern.
Currently, Guidewire carries a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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