TCS bags $2 bn deal to transform Transamerica's insurance & annuities admin

Company to preserve 2200 Transamerica jobs

Tata Consultancy Services (TCS) on Thursday announced that it has entered into an agreement with Transamerica, a leading provider of life insurance, retirement and investment solutions, to enable the transformation of administration of its US insurance and annuity business lines. 

The partnership enables Transamerica to rapidly enhance its digital capabilities, simplify the service of more than 10 million policies into a single integrated modern platform, and drive greater sustainable growth opportunities through superior customer experiences. The multi-year agreement is worth more than $2 billion in revenues, and is expected to be completed by the second quarter of 2018.

The partnership will enable the transformation of the administration of Transamerica’s life insurance, annuity, supplemental health insurance, and workplace voluntary benefits products. It will also support the company’s overall transition to a simplified, cloud-enabled platform for agile new product development, enhanced services, acquisitions, and strategic innovation investments. This agreement is expected to lead to annual run-rate savings of approximately $70 million initially – growing to $100 million over time – for Transamerica. The majority is expected to benefit underlying earnings.

 “TCS is helping to guide many of today’s leading companies through their business 4.0 journeys, in building their digital spines, becoming more agile, creating superior customer experiences, and driving exponential growth,” said Rajesh Gopinathan, CEO and Managing Director of Tata Consultancy Services. “We have invested heavily in our insurance digital platform, TCS BaNCS, and our extensive US capabilities, and are proud to partner with Transamerica in its ongoing transformation and welcome the transitioning employees to promising new careers at TCS.”

TCS will make job offers to all of the applicable Transamerica employees currently supporting the life insurance, annuity, supplemental health insurance, and workplace voluntary benefits business lines, ensuring a consistently excellent experience for Transamerica customers and protecting approximately 2,200 American jobs. Employees transitioning to TCS will be given the opportunity to remain in the same US cities where they are currently based. TCS will also expand its existing relationship with Transamerica under this transaction, and locate in Transamerica’s current offices in various US cities.

“Transamerica continues to put our customers at the forefront of everything we do. I’m very excited to embark on this partnership with TCS, whose transformation and technology innovation capabilities will supplement our focus on improving our customers’ experience in a digitally enabled way. This supports meaningful growth in all business lines, including insurance and annuities, and advances our competitive positioning. TCS was carefully selected because of their significant, ongoing investments in technology and their expertise in the insurance and annuity industry,” said Mark Mullin, Transamerica President & Chief Executive Officer. “TCS’ core competencies complement ours. TCS will provide valuable administration and quality customer service, and Transamerica will continue to engage with our customers, clients and advisors in the most meaningful ways to them by utilizing our digital engagement platforms and developing new solutions that help people save, protect, invest and retire.” 

TCS plans to make a significant investment in the region, most notably by establishing its new North American insurance hub for business operations in Cedar Rapids, Iowa. Beyond offering roles to 2,200 Transamerica employees across US cities, TCS plans to hire locally in Iowa, set up relationships with educational institutions, and help employees with professional development to gain digital skills and fluency. As one of America's 50 most community minded organizations, TCS will also work with state and local leaders, and community organizations to bring its flagship education programs, such as goIT and Ignite My Future In School to students, educators, schools, and communities across Iowa.