) has been selected by India's HDFC ERGO General Insurance Company
Limited to manage its digital applications. Per the multi-year
outsourcing contract, Accenture will enhance and develop HDFC
ERGO's digital channels such as web portals and mobile
applications. Moreover, Accenture will customize the insurance
company's sales techniques through strategic planning to suit
According to a report from Indian Brand Equity Foundation, the
life insurance industry in India is projected to increase at a CAGR
of 12-15% for the next five years and is expected to touch $1
trillion in the next seven years.
According to Gartner, in 2014, spending on IT products and
services by Indian insurance companies will reach approximately
$2.01 billion, up 12% from 2013. These projections bode well for
Accenture as it has a strong presence in the country.
Moreover, Accenture has been serving the insurance vertical for
years. Continuous insurance deal wins underscore the efficacy and
popularity of its services. This has also aided its revenues.
In the last-reported quarter, Financial Services revenues, which
combine banking, capital markets and insurance, increased 4% year
over year and helped Accenture register 1% increase in revenues.
Other operating segments either declined or remained flat on a
It is worth mentioning that Accenture's foothold in the
insurance solutions market was further strengthened by the
acquisitions of Duck Creek (Jul 2011) and avVenta (Oct 2012).
Synergizing these acquisitions enhanced Accenture's insurance
platform, which, in turn, is helping insurance providers adapt to
the changing market conditions, gauge future requirements and run
Nonetheless, the competition in the insurance sector is also
increasing with players like
International Business Machines
Computer Sciences Corp.
) coming up with cost-effective solutions.
These companies have also started aggressive marketing to take a
bite out of the insurance market, especially in emerging countries.
Thus, we believe that Accenture has to come up with innovative and
customized insurance solutions to maintain its current position in
Currently, Accenture has a Zacks Rank #4 (Sell).
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