LexisNexis Risk Solutions has entered into a definitive agreement to sell its insurance software solutions business to the San Francisco-based private equity firm Genstar Capital. Genstar is expected to resurrect the Insurity brand once the deal is completed, according to Donald Light, senior analyst with Celent.

The insurance software business being sold to Genstar is directed toward the property & casualty insurance industry with policy administration, claims, billing, and business intelligence solutions.

“The Insurity name disappeared when LexisNexis bought ChoicePoint,” says Light. “They rebranded it to LexisNexis Insurance Software Solutions, which was too big of a mouthful. It’s the same group of core systems software with the old brand.”

LexisNexis Insurance Software Solutions is based in Hartford, Conn., with additional offices in Dallas; Redwing, Minn.; and Melville, N.Y., the business has approximately 400 employees and serves more than 100 insurers from startups to tier-one carriers.

LexisNexis will hold on to its data and analytics business as the focus of their insurance portfolio “as we continue to help our customers make faster, more accurate underwriting and policy-pricing decisions, reduce claims losses, and improve their client’s experience,” says James M. Peck, CEO, LexisNexis Risk Solutions.

After careful review, LexisNexis decided that the insurance software business would be better aligned with an organization like Genstar, which has some experience in software and the insurance industry.

Light maintains this is Genstar’s biggest step into insurance software. The firm has a smaller portfolio in insurance software, but nothing of this scale, according to Light.

“This is a new level of investment and involvement for them,” he says. “They aren’t strangers to insurance software, though.”

Light believes the sale is fundamentally a good thing for Insurity and their customers.

“It was never clear that LexisNexis, being an information-based company, was going to be a long-term corporate home,” he says. “The new owners will view it as a stand-alone business and will make appropriate investments for that purpose. The upside potential is different as they now have an owner that is much more focused on making them successful as an insurance software company, whereas the previous owner had many focuses. This is a small part of the LexisNexis universe.”

Following completion of the transaction, Jeffrey Glazer will be leaving LexisNexis to lead the insurance software solutions business for Genstar.

The insurance data and analytics business for LexisNexis will continue to be led by Bill Madison. Peter Lynch will continue to be responsible for the LexisNexis Insurance Exchange.

The transaction is subject to customary conditions and regulatory consents and is expected to close by the end of 2011.