www.sapiens.com 1 www.sapiens.com

Roni Al-Dor, CEO Roni Giladi, CFO Yaffa Cohen-Ifrah, VP Corporate Marketing & Communications William Blair’s Annual Growth Stock Conference - June 2014

www.sapiens.com 2

Safe Harbor Statement

Certain statements made in this presentation may be constitute “forward-looking statements” within the

meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of

1934 and the United States Private Securities Litigation Reform Act of 1995. Words such as "will,"

"expects," "believes" and similar expressions are used to identify these forward-looking statements

(although not all forward-looking statements include such words). These forward-looking statements,

which may include, without limitation, projections regarding our future performance and financial

condition, are made on the basis of management’s current views and assumptions with respect to future

events. Any forward-looking statement is not a guarantee of future performance and actual results could

differ materially from those contained in the forward-looking statement. These statements speak only as of

the date they were made, and we undertake no obligation to update or revise any forward-looking

statements, whether as a result of new information, future events or otherwise. We operate in a changing

environment. New risks emerge from time to time and it is not possible for us to predict all risks that may

affect us. For more information regarding these risks and uncertainties as well as certain additional risks

that we face, you should refer to the Risk Factors detailed in Item 3 of Part III of our Annual Report on Form

20-F for the year ended December 31, 2013 and subsequent reports and registration statements filed from

time to time with the Securities and Exchange Commission.

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• Core software policy administration solutions

• For insurance & financial services customers, globally

Founded / IPO: 1982 / 1992 / 2013

Employees: 900+

Customers: 130+

Global Footprint: EMEA 58% / N. America 33% /

APAC 9% of 2013 Revenue

Revenue: $135.4mm in 2013; expect

~15.2% growth in 2014

Who is Sapiens?

Key Statistics

Historical Perspectives

1982-2000 2001-2008 2009+

Application development

platform

Tailor-made solutions

Focus on insurance

market

Next-generation insurance &

technology portfolio

Expand to financial services

What Do We Do?

Provide core software solutions for insurance and financial services companies

Insurance Software

• Innovative platform for business decisions

P&C L&P Retirement

Technology-Based Solutions

Early Days Pivot 1 Pivot 2

Investment Banks

Retail Banks

Mortgage Banks

Other

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Our Vision

To become

a leading provider of innovative

software solutions for the

global Financial Services market,

with focus on Insurance

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Investment Highlights

$25bn addressable market undergoing transformative modernization

Strong financial profile with multiple growth drivers and good visibility

Proven management team

Innovative products with proven leading functionality and technology

Full suite of core solutions for L&P, retirement, and P&C markets

Blue chip customer base across a broad geographic footprint

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The Market

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The Insurance Industry

Big Market ― $4,200,000,000,000

gross written premium (GWP)

Potential ― > 11,000 insurance companies globally

Investment in IT ― $153B

Source: Market size data per Celent. March 2013

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Insurance and Financial Markets are Evolving Rapidly

• Improve end-customer experience through

innovative initiatives

• Mobile, social media etc.

• Support customers’ growth & operations:

• Reduce time to market of new

products

• Expansion into new geographies

• Cost reduction & improved operations

Market Drivers

Insurance and financial services providers need to balance rapidly changing customer requirements and an evolving regulatory framework

Evolving Regulatory Framework

• Solvency II

• Basel

• Dodd-Frank

• Schedule F

• MISMORegulatory compliance

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But still based on Legacy systems

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• Total 2014 external software and services estimated spend: $59.9 billion growing at mid-single digits

• Of which, Sapiens’ TAM is estimated at $25 billion

• Growth of TAM driven by shifts from: • Legacy to modern solutions • Internal to external spending

The Insurance IT Opportunity is Large and Growing

Highly Attractive Growing Market

Source: Market size data per Celent. New/Legacy graphic for illustrative purposes.

Legacy New

2014E Insurance External Software and Services Spend: $59.9 billion

Trends

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Market Transformation in the next Decade

ERP

Banking

Insurance

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Sapiens Today

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Current Sapiens Portfolio

Life, Annuities Pension &

Retirement

Property &

Casualty

Decision Management

Technology

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Leadership in Insurance Solutions

EMEA North America

Sapiens ALIS is a market leader and should be considered for most short-lists.

Ovum Jan, 2013

ALIS continues to be one of the leading products in the region…

among the best that Celent have seen.” Celent, Nov 2013

Source: XCelent Awards – EMEA Policy Administration Systems for Life, Annuities, Pension and Health, 11/2013. Xcelent Awards - North American Policy Administration Systems 2013 Life, Annuities, and Health 11/2013

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Leadership in Insurance Solutions

Source: Celent research, EMEA Policy Administration Systems, General Insurance, Property&Casualty, January 2014, Craig Beattie Ovum Decision Matrix – P&C Policy Administration Platform Europe, 10/2013. Bubble size represents market impact.

EMEA

3

4

5

6

7

8

9

6 7 8 9O

vera

ll Ex

ecu

tio

n A

sses

smen

t Overall Technology Assessment Score (1–10)

Leader Challenger Follower

Guidewire PolicyCenter

Sapiens IDIT

Accenture Duck Creek Policy

Administration

eBao Tech GeneralSystem

Suite

Innovation Group Insurer Policy

GraphTalk A.I.A.

Xuber for Insurers

TCS BaNCS

“Sapiens continues to offer a solution with great functionality and very strong technology in the EMEA region,….Sapiens IDIT continues to excel as a leading

solution in both functionality and technology.” Celent, Jan 2014.

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Innovation of Technology Based Solutions

1980 1970 2010 2000 1990 2020

Business Process Management

Analytics and Decision Management

2030

Informal design and development methods

Data Management Data

Analytics

Process

Source: Gartner

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Blue-Chip Global Customer-Base

North America UK Europe APAC

Bulgaria

2013 Revenue Contribution

33% 21% 37% 9%

Growth Strategy

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Sapiens Strategy: ‘ONE STOP SHOP’

Project &

Delivery

Product

Added Services

Support

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Our Strategic Direction

Decision

L&A

P&C

Investments in our Growth Engines

Strengthen our Geographic Presence

Europe

APAC

UK US

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Proven Management Team

Roni Al-Dor President & CEO

Ronald Karam President, NA insurance

Gary Sherne Managing Director Property & Casualty

Rami Doron Managing Director, DECISION

Roni Giladi CFO

Osnat Segev-Harel Corporate Development

2005

2007

2007

2009

2007

2014

Irit Nusel Managing Director Life Insurance

Raj Ghuman Regional Manager UK & Nordics

2013

1995

Joined Joined Prior Experience Prior Experience

Henry Ainouze Regional Manager Benelux/France

2011

Yaffa Cohen-Ifrah VP Corp Marketing & Communications

2014

Steve Rooney EVP Global Sales DECISION

2014

*

*

*

Manabu Okada Regional Manager Japan

1998

Hadas Gazit CBOO

2011

Wayne Te Paa Regional Manager APAC

2014 *

*

Anat Belluco VP Global HR

2013

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Opportunities for Growth

Pursue strategic acquisitions 5

Enhance portfolio through innovative technologies 4

Growth into new markets 3

Acquire new customers 2

Expand with existing clients 1

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Financials

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1.3 1.5 1.7 2.1 1.9 2.0 2.0 2.4 2.0 2.0 2.1 2.6

3.3 3.7 4.1 4.0 3.4 3.3 3.6 3.8 3.7

Non-GAAP

Attractive Financial Profile

Consistent Operational Profitability(3)

Quarterly Operating Profit ($mm)

45.7 52.2 70.3

114.2 135.4

156.0

45.7 52.2

98.1 114.2

135.4

154-158

2009 2010 2011 2012 2013 2014

Impressive Annual Revenue Growth Strong Annual Cash Flow

Total Revenue ($mm) Operating Cash Flow ($mm)

1 Revenues of $98.1mm in 2011 pro-forma for the FIS and IDIT acquisitions. 2 Non-GAAP revenues. 2014 guidance per Sapiens press releases dated February 26, 2014. 3 Non-GAAP operating profit excludes stock-based compensation, amortization of intangibles, capitalization and amortization of software, and valuation adjustment on deferred revenue.

(1)

(2)

13.5 12

8.4

18.8 17.3

2009 2010 2011 2012 2013

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31%

38%

20%

11%

2012

27%

35%

27%

11%

2011

33%

41%

17%

9%

2013

US

Europe

IL

APAC

Annual Revenue by Geography

25.9 34.2

26.7

11.2

35.6 42.8

23.3

12.5

44.2

56.1

22.9

12.2

0

20

40

60

NA EU IL APAC

2011

2012

2013

2011:Pro forma (Non-GAAP USD Millions)

Consistent Revenue Growth in NA and EU

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Attractive Revenue Model …

Revenue ($mm)

Illustrative $5mm initial contract

2.0 2.0

0.5 0.5

Year 1 Year 2

0.9 0.9 0.9 0.9

0.2 0.2 0.2 0.2

Year 3 Year 4 Year 5 Year 6-10

Typical life of product engagement: 10–15 years 2-3x initial contract values

Stickiness Contractual

Pre Production Ongoing Post-Production

High

Go

-Liv

e

$2.5 $2.5

$1.1 $1.1 $1.1 $1.1

License Maintenance Services

Product L&A P&C Reinsurance DECISION

Deal Size $7-$10m $4-$6m $1-$1.5m $1-$4m

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… With Significant Visibility R

eve

nu

e

Time

20% New Customers

Layered revenue streams create significant visibility

Year 2

Year 3

Year 4

80% Existing Customers

Year 1

Year 5

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Q1 2014 – Gross Profit and Margin

• Implementation of new L&P release

• Development of new product for retirement services

• Delivery staff recruitment to support the significant revenue growth

$13.5 $14.6

$5.0

$7.0

$9.0

$11.0

$13.0

$15.0

2013 2014

Gross Profit

42.8% 40.0%

30%

40%

50%

2013 2014

Gross Margin

(Non-GAAP USD Millions)

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Improved Gross Margins – Key Initiatives

Improve Revenue Mix • Invest in R&D to enhance technology and

enrich product functionality, to allow higher license price

• Grow DECISION out of the total mix • Start working with system integrators to

shift low service work outside and keep the premium service to Sapiens

$

Time

Products

Improve Delivery Margins • Repeatable business from the same product

line and the same territories • Product maturity allow higher gross margin • Increase recurring revenue (account

management, extended maintenance, additional services etc,…(

• Shift non sophisticated tasks to Offshore

Typical Gross Margin of Engagement

Gross

Margin

Pre Delivery Ongoing Post-Delivery

Go

-Liv

e

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Q1 Profit and Loss Highlights - Non GAAP

First Quarter

2013 2014

31.5 36.6 Revenue

13.5 14.6 Gross Profit

42.8% 40.0%

3.4 3.7 Operational Profit

10.6% 10.0%

3.4 3.4 Net Income

10.7% 9.2%

3,617 4,020 Adjusted EBITDA

0.08 0.07 Diluted EPS

40,643 48,493 Weighted Average no. of shares

Outstanding shares*: 46,882 (in USD Million except per share amount)

* as of March 31st, 2014

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Financial Highlights

~15.2% organic growth in 2014

Operationally profitable since Q4 2006

Cashflow positive since 2007

Balanced Financial

Profile

Diversified revenue base:

4 continents

Multiple product lines

Over 130 customers

Risk diversification

Long engagement cycle with repeat revenues

Existing clients account for 80% of revenues

Multiple growth engines

Highly Attractive

Revenue Model

~$75.0 m cash on balance sheet as of end-of-March 2014

No financial debt Well Capitalized

Gross Margins

Flexibility

Gross margins leverage

Revenue mix

Post delivery margin

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Thank You

Contact: Roni Giladi, CFO Yaffa Cohen-Ifrah, VP Corporate Marketing & Communications Phone: +972-3-7902032 e-Mail: IR.sapiens@sapiens.com Website www.sapiens.com

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Appendix

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Non-GAAP Reconciliation

(in USD Thousands except per share amount)

Three months ended

03/31/2014

03/31/2013

GAAP/Non-GAAP revenue

$ 36,628

$ 31,507

GAAP gross profit

$ 13,377 $ 12,144

Amortization of capitalized software

1,047 1,124

Amortization of other intangible assets

224 217

Non-GAAP gross profit

$ 14,648 $ 13,485

GAAP operating income

$ 3,174 $ 2,580

Gross profit adjustments

1,271 1,341

Capitalization of software development

(1,401) (1,108)

Amortization of other intangible assets

337 328

Stock-based compensation

271 214

Non-GAAP operating income

$ 3,652

$ 3,355

GAAP net income attributable to Sapiens' shareholders

$ 3,022 $ 2,633

Operating income adjustments

478 775

Other

(125)

(36)

Non-GAAP net income attributable to Sapiens' shareholders

$ 3,375

$ 3,372

Non-GAAP basic earnings per share

$ 0.07

$ 0.09

Non-GAAP diluted earnings per share

$ 0.07

$ 0.08

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Key Balance Sheet Highlights

(in USD Million)

December 31, 2013 March 31, 2014

70.3 75.0 Cash

23.7 24.9 Account Receivable

9.9 12.1 Deferred Revenue

0 0 Debt

170.4 174.1 Total Equity

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Strong Free Cash Flow

(in USD Million)

March 31

2013 2014

3.5 6.0 Net cash provided by operating activities

(1.1) (1.4) Net cash used for capitalization of R&D

(1.0) (0.5) Net cash used for investing activities

(4.7) 0.7 Net cash provided by (used for) financing activities

(0.1) (0.1) Effect of exchange rate changes on cash

(3.4) 4.7 Increase (decrease) in cash

29.0 70.3 Cash at beginning of year

25.6 75.0 Cash at end of year