Houston-based Connective Technologies, Inc., a provider of Exchange solutions for the property and casualty insurance industry in the United States, has been acquired by Ebix (News - Alert), Inc., through an asset purchase transaction.

Ebix, international supplier of On-Demand software and E-commerce services to the insurance industry has signed the binding agreement and closed the transaction. Connective will become a part of the EbixExchange Division of Ebix, with the acquisition expected to be accretive to Ebix Earnings per Share.

Ebix will enter into the largest property and casualty exchange market in the world with this acquisition. Approximately 38 percent of the $1.5 trillion premiums conducted in the property and casualty sector worldwide is accounted by the United States. Approximately $59 billion a year is being spent on paper-based processes in the United States P&C insurance sector, according to estimates by independent analysts. On-demand exchange services for this sector in the United States will be the focus of Ebix's P&C Exchange.

Approximately 40 different broker systems in the United States have the Connective exchange interfaced successfully with approximately 60 insurance carriers and their agents utilizing Connective's exchange solutions.

According to Dan Delity, SVP, EbixExchange, the company has been contemplating entering the P&C exchange markets in the United States after its successfully runs leading P&C exchanges in Australia and New Zealand. The asset purchase of Connective was done because Connective is an established player in the market with an on-demand solution implemented for approximately 60 carriers, added Delity. The company is excited about this acquisition as a real alternative to IVANS can be provided to the P&C insurance industry.

According to Robin Raina, president and CEO, Ebix, the company’s P&C exchange can guarantee 50 percent cost savings to the carriers apart from providing security and robustness. The company can deploy this solution virtually in days, for hundreds of agents across 40 different broker systems.

The acquisition will contribute recurring revenues, great operating margins and organic revenue growth to Ebix in 2010 and beyond. The switching of a large property and casualty carrier to EbixExchange platform will be announced soon, concluded Raina.

P&C Exchange solutions will be exhibited at the ACORD conference in Las Vegas.