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June 03, 2024 at 04:39 PM
An F&G Annuities & Life subsidiary is suing an insurance industry software developer over a system replacement project.
Fidelity & Guaranty Life Business Services said in a complaint filed May 30 in the U.S. District Court for the District of New Jersey that it hired Majesco to help it move to a new distribution management system.
The system was supposed to help F&G handle agent contracting, commission calculations and other agent-related tasks.
The Des Moines, Iowa-based company hoped to get the system running quickly. Instead, F&G said, it has worked with Majesco for more than three years, spent $8.3 million and received no new functioning software.
Representatives from Majesco were not immediately available for comment.
The history: F&G signed a five-year subscription agreement with Majesco in September 2020. F&G agreed to pay the Morristown, New Jersey-based company $800,000 per year.
The companies negotiated a new agreement, with an Aug. 7, 2023, “go live” date, in August 2022. The agreement set a cap of $2,285,193 on project fees and expenses.
The companies agreed to a change request with a price cap of $1,852,600 in September 2022, a project simplification change in October 2022 and another change request in March 2023.
In May 2023, Majesco told F&G that the project timeline would have to be extended to February 2024.
