By Nathan Conz, Insurance & Technology
In a move to further expand its presence outside its core mailing business, Pitney Bowes ($5.7 billion in revenue) announced plans to acquire MapInfo Corporation (Troy, N.Y.) for approximately $408 million in cash. The deal could significantly strengthen the Stamford, Conn.-based company's position in geographic information system (GIS) technology.Pitney Bowes first established a foothold in business geographics as part of its acquisition of Group 1 in 2004. Its GIS capabilities in the insurance vertical are presently focused almost entirely on underwriting, with offerings such as address verification in policy management systems. "Historically, we've been focused on the operational side of business geographics. We don't have map displays. We're about returning just information," says Steve Walden, vice president, business geographics for Pitney Bowes Group 1 Software.
MapInfo has a broader reach within the insurance vertical with its predictive analytics and modeling capabilities. From a marketing standpoint, insurers can use MapInfo products to target a given area for a certain new product or promotion. On the actuarial side of things, carriers can plot out where historical losses have occurred to help build rating territories.
Growth potential within the insurance vertical was a motivating factor in the acquisition. "We think it's an industry where, from a timing perspective, it couldn't be any better," Walden says, specifically pointing toward the multichannel distribution trend. As some companies abandon the captive agent-only model, technology is needed to supplement - but not replace - the local agent's understanding of local geography, he says.
"Insurers are going to welcome this move. I think the combinations of technologies from both sides are going to create much more compelling solutions for the various carriers. A lot of the same companies have independently chosen both organizations for what we do best," Walden says.
Most organizations are trending toward dealing with a single vendor for many capabilities, Walden continues. "It allows us to deliver a much broader solution set for our customers, which they're telling us they really want."
MapInfo will function as a company, with its existing management in place, under the Pitney Bowes umbrella, and will remain headquartered in Troy, N.Y.