Headlines:
IBM Buying RBC Insurance Unit
International Business Machines Corp. is buying a Royal Bank of Canada unit that provides outsourced contact center management, policy administration, claims management, and payment receipt and reconciliation for life insurance companies.
The unit is Liberty Insurance Services Corp. of Greenville, S.C. Liberty's 12 clients have 3.6 million policies. Most of the 12 are in this country, but some are in Canada, including RBC Insurance, which provides about half its business.
The deal was announced Tuesday and is expected to close before yearend. IBM refused to reveal the price.
IBM already provides technology services to hundreds of clients in the life insurance industry, and the company is one of the dominant providers of technology services to banks, said Michael Corrado, a spokesman for the Armonk, N.Y., company. Buying Liberty will bring it into a $500 billion market for services that insurers tend not to outsource to technology companies, he said.
"These are the types of services that clients increasingly want to have," he said.
IBM and Liberty have been strategic partners for over five years and have worked together with common clients, Mr. Corrado said.
Jim Westlake of Royal Bank of Canada said that the life insurance outsourcing business has a lot of growth potential in the United States but that "IBM was better suited than we are" to run Liberty.
"IBM is a very big provider in the insurance industry," so it already has the needed connections and experience, said Mr. Westlake, who heads the banking company's insurance business globally in addition to its Canadian banking and investment businesses.
IBM said Liberty will continue to be run from its Greenville headquarters. The company also has offices in St. Louis and Atlanta.
First Horizon Using Tumbleweed
First Horizon National Corp. of Memphis is using firewall software from Tumbleweed Communications Corp. of Redwood City, Calif.
First Horizon said its banks were being flooded with unwanted e-mail and installed Tumbleweed's software to filter out spam and protect its computers from viruses.
"We are now blocking 65% of inbound e-mail" as spam, said Garry Anderson, First Horizon's manager of research and analysis, in a Tumbleweed press release Monday.
The software also encrypts outgoing e-mail messages to customers and employees, Mr. Anderson said.
Joe Fisher, Tumbleweed's vice president for product marketing, said in the press release that its software keeps First Horizon "in compliance with privacy protection regulations" while blocking spam and viruses.
