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The deal to merge the St. Paul Cos. and Travelers Property Casualty Corp. is on track to create the second-largest insurer in the country, with top market shares in 22 states, according to Jay Benet, chief financial officer of Hartford, Conn.-based Travelers.Benet, who is the designated CFO for the projected St. Paul Travelers Cos., discussed some terms of the deal in December at the Bank One Capital Markets Insurance Company Investors Conference. The deal, announced on Nov. 17, will be a tax-free transaction, with an exchange of 0.4334 St. Paul share for each Travelers share.

The Contracts Update section includes announcements of contracts insurance information technology companies have signed with customers in recent weeks. Contract news can be faxed to Insurance Networking magazine at (312) 913-1366 or by electronic mail to Stephen.Dwyer@ thomsonmedia.com BIS Inc.

There's no question that independent agents are highly valuable participants in the insurance marketplace. But carriers that depend on independent agents are continually trying to determine what's important to them when they choose carriers.Two recent studies conducted by Celent Communications Inc. provide some insight.

Information technology in the healthcare industry should not be rocket science. That's the opinion of a former aerospace engineer, Charles C. Emery, Jr., who is senior vice president and chief information officer for Horizon Blue Cross Blue Shield (BCBS) of New Jersey.

Back in early 2002, the office environment at World Insurance Co. resembled a noisy beehive with workers faxing, printing, copying, retrieving documents from warehouse storage and chatting while carrying out those tasks.

Small to mid-sized businesses are often stretched to the limit in managing their human resource responsibilities-with one of the efforts being the administration of group 401(k) retirement and investment programs.

Despite insurers' best intentions to align business strategy with IT strategy, recent studies show that more than 80% of insurance companies can improve on that alignment.That's according to Deborah Smallwood, insurance practice leader at TowerGroup Inc., a Needham, Mass.-based research and advisory firm. At press time, Smallwood was completing a study of six property/casualty carriers, and, although she couldn't release her findings, she said she gets frustrated because the alignment still isn't there-and there's so much need for improvement.

There are a number of storage area network (SAN) management tools now on the market to help automate and monitor storage management processes.At Mid-Continent Casualty Insurance Co., Tulsa, Okla., for example, the expansion of the company's SAN introduced an array of new Intel-based servers to the data center.

Experts predict that the next generation of storage area network (SAN) technology will be built on storage virtualization. IBM Corp., Armonk, N.Y., already has released storage management products that provide a software virtualization layer that manages physical storage devices.Virtualization of storage hardware resources is just one of two forms SAN virtualization is likely to take, according to John McArthur, analyst with IDC, a Framingham, Mass.-based technology research firm.

Web-Enabled IllustrationTravelers Life & Annuity, Hartford, Conn., is providing to its brokers and producers the WinFlex Web illustration system from LifeLink Corp., Park City, Utah. WinFlex Web is a single entry, multiple carrier interface (SEMCI), which runs illustrations for multiple carriers' products on a single system via the Internet. Compared with the desktop version, WinFlex Web eliminates software distribution and installation difficulties and costs; ensures all producers use current software; provides valuable usage statistics; simplifies and accelerates new product introductions; enables brokers access to all approved carriers from one portal location; make bug fixes available immediately; and eliminates the need for Citrix-hosted solutions.

A major strategy within the property/casualty insurance industry is entering new distribution channels using the Web and other technologies. To facilitate this strategy, the underlying business functionality that supported the expansion into new distribution channels was primarily based on systems that are on average more than 25 years old-augmented with newer technologies, such as expert underwriting engines.These back-end systems are inherently front-end technology "neutral" and have successfully been front-ended by J2EE and .NET frameworks. While most of these efforts have been successful in meeting the initial goal for entering new markets, these efforts also have uncovered-and in some cases intensified-the inherent legacy problem.

Zix Corporation, a global provider of protection, management, and delivery solutions for electronic communications, announces that Blue Cross and Blue Shield of Oklahoma, the oldest and largest private health insurer in the state serving almost 770,000 Oklahomans, has signed a three-year contract for ZixCorp secure e-messaging services to help meet the privacy and security guidelines of the Health Insurance Portability and Accountability Act of 1996 (HIPAA).

MILWAUKEE--Fortis Health signed its first individual medical Health Savings Account (HSA) policy, believed to be the first HSA policy in the country. The policy, which was opened by an individual residing in Aurora, Ill., is the first of the estimated over 40 million HSA accounts that will be established in the next 10 years, according to congressional analysts. Beginning January 1, 2004, Fortis Health will offer comprehensive HSA products for individuals and small groups through Fortis Insurance Company and John Alden Life Insurance Company.

NEW YORK -- The AIG Mergers & Acquisitions Division, a division of the property and casualty insurance subsidiaries of American International Group, Inc. (AIG), announced the launch of its newly designed global Web site, www.AIGMergerRisks.com.

ATLANTA --Ebix, a leading international supplier of software and e-commerce solutions to the insurance industry, announced today that it has changed its name to Ebix, Inc. from ebix.com, Inc. effective immediately.

LOUISVILLE, Ky. -- Healthcare Underwriters Group of Kentucky (HUGKY), a medical professional liability insurance company owned by Kentucky doctors, today received authorization from the Kentucky Department of Insurance to begin operations.

Harvard Pilgrim Health Care today announced the launch of a free, online service that allows insurance brokers to obtain rates and renew Harvard Pilgrim's small-group accounts at their convenience. Easy Online Renewal, which is a secure, password-protected feature of Harvard Pilgrim's Website, is the first service of its kind in Massachusetts .

OVERLAND PARK, Kan. --Sprint today announced it has expanded its relationship with the Blue Cross and Blue Shield Association (BCBSA) through a new, multi-million dollar agreement for Cisco Systems customer premise equipment (CPE) and maintenance.

Washington, D.C.-The American Council of Life Insurers (ACLI), the leading life insurance trade association in the U.S., today commended the Office of the U.S. Trade Representative (USTR), the U.S. Commerce Department and other U.S. Government Trade Negotiators for finalizing agreement with Guatemala, Honduras, El Salvador, and Nicaragua to form the Central American Free Trade Agreement (CAFTA).

EL SEGUNDO, Calif. -- Computer Sciences Corporation today announced that American United Life Insurance Company (AUL) has licensed Automated Work Distributor (AWD) software to improve the efficiency of its back-office operations by streamlining its business processes.