www.sapiens.com

Investor PresentationQ1 2017 Results

Needham Emerging Technology Conference, NYC, May 2017

Roni Al Dor, President and CEO

Roni Giladi, CFO

Yaffa Cohen-Ifrah, CMO

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, 2016 and subsequent reports

and registration statements filed from time to time with the Securities and Exchange Commission.

2

Who is Sapiens?

3

Leading global provider of software solutions across the insurance industry

Growing presence in the financial services sector

DNA of technology platform & insurance domain expertise

North America: 34%United Kingdom: 22%Europe: 16%Israel: 14%APAC: 14%

Global Footprint

400 Customers

2,500 Employees

114 135

158 179

216

2012 2013 2014 2015 2016

Revenue Growth

Non-GAAP revenue (USD M); See appendix for Non-GAAP reconciliation

Our Offering

44

Provide core software solutions for insurance and financial services companies:

Innovative platform for business decisions

Core software policy administration solutions

Technology based solutions

Insurance software

Application development platforms

Retirement

Life & Annuities

Decision Management eMerge

Property & Casualty

L&A

P&C

~80% of the business

Run mission-critical operations of insurance industry

Provide functionality to support the full lifecycle of insurance carriers

~20% of the business

Includes a disruptive business decision engine

Reinsurance

Sapiens’ Mission

Help our clients keep pace with the changes ahead and become fully digital

Allow our clients to offer a personalized, omni-channel experience that puts the customer in the center

Enable operational efficiency and agility to accelerate growth

5

The Insurance Markets

66

The Insurance Markets

Highly regulated industry with accelerating regulatory changes

Competitive markets with little product differentiation

Increased globalization Legacy IT transition challenges

Enterprises are seeking modular, next-gen solutions to ease the transition and transform the consumer experience

WealthLiabilityCatastrophe PropertyMotor Voice

PROPERTY, CASUALTY, REINSURANCE

LIFE, ANNUITY, RETIREMENT

Annuities Retirement LifeInjuries

7

The Insurance Industry

Source: Market size data per Celent. April 2016

Big Market

$5,200,000,000,000 gross written premium (GWP)

11,000 insurance companies globally

Potential

3-4% of GWP invested in IT

$185B in 2016 Life - $99B; P&C - $86B

IT-related Investment

8

The Insurance IT Opportunity is Large and Growing

Source: * Gartner Verticals Forecast world wide By Insurance, April 2016 and company analysis ** Source: Market size data per Celent. April 2016

Global IT spending 2016-2017 expected

to increase by

6%

External Software and IT services

spending2016-2017

expected to grow by

7%**

Sapiens’ Total Addressable Market*

$30B Highly Attractive Growing Market

Highly Attractive Growing Market

9

Today’s Market Challenges & Trends

10

Regulation CompetitionRisk

Mitigation

Customer Experience

Personalization Flexibility

Time to Market Efficiency New Models

Sapiens Today

1111

Large and expanding global footprint

End-to-end solutionsLeading technology Domain expertise

Decades of proven project delivery Award-winning, packaged solutions Consultative approach

12

Our Value Proposition

North America

“The ALIS system has a very good user interface. It is simple for the user and flows well...The ALIS system has a graphical policy timeline that is unique and useful for a customer service representative working with a client. Sapiens is releasing new portals,which Celent reviewed, that are among the best we have seen.“ ...”Going forward, we expect the Sapiens ALIS system to makemost evaluation short lists and Sapiens to expand its already rich customer base in the EMEA region.”

Nov. 2015

XCelent Awards - EMEA Policy Administration Systems for Life, Annuities, Pension and Health, 11/2015 13

Leadership in L&A SolutionsBreadth of Functionality, 2015 Breadth of Functionality, 2015

EMEA

Leadership in P&C Solutions

“Sapiens IDIT continues to offer a strong digital policy administration system for insurers globally, with strong experience across Europe…customers commented that Sapiens is responsive, committed, and constructive, and can provide creative solutions.”

Feb. 2016Celent research - EMEA Policy Administration Systems, General Insurance, Property & Casualty February 2016, Craig BeattieCelent research – APAC Policy Administration Platform Property & Casualty, 04/2016, KyongSun Kong 14

Technology and Breath of Functionality, 2015 Technology, 2015

EMEA APAC

One-Stop ShopAcross Products and Services

1515

One-Stop-Shop Across Products and Services

Sapiens Retirement

Sapiens P&C

Sapiens L&P

Sapiens Reinsurance

Hosting

Product Upgrades

TrainingSupport Services

Migration

TestingConsulting

Project Implementation

Sapiens DECISION

16

Blue-Chip Global Customer-BaseLong term Partnership

Bulgaria

North America

UK

ContinentalEurope

APAC

17

Global Presence

18

Development & Delivery Center

Site

Executive Team

Roni Al-DorPresident & CEO

2005 Roni GiladiCFO

2007

2013Irit NuselManaging DirectorLife, Pension and Retirement

2014Yaffa Cohen-IfrahCMO and Head of Corporate Communications

2016Norman TutnauerHead of Global Sales

2007Rami DoronManaging Director,DECISION

2016Liana GelikasManaging Director Property & Casualty

2013Anat Belluco FeinkuchenVP Global HR

Tal SharonRegional ManagerIsrael

2011 Osnat Segev-HarelHead of Corporate Development

2009

Proven Management Team

19

OurStrategy

2020

Focus on InsurTech

21

Land and Expand Strategy

22

Win New Customers

Grow with Existing Customers

M & A

Our M&A Strategy

23

Complementary Solutions Growing Customer Base Geographic Expansion

Customer Base

Geographic Expansion

Complementary Solutions

3 core products

2 offshore operations

76 new customers

1 patent

INSECO

Completed 8 M&A NEXT STEP

Growth Supported by Focused M&A Strategy

24

StoneRiver Acquisition

25

26

About StoneRiverA provider of Insurance software and services in North America

500 Professionals 200 Customers $80M RevenuesWide Range of

Insurance Products

Geographic Presence Customer Base People Products

27

The Benefits Of the Acquisition

Expands presence in the North American insurance market

Double Sapiens’ customer count from 200 to over 400

Adding over 500 insurance experts with Industry knowledgeclose to U.S. customers

P&C offerings Complementary

L&A offerings Reinsurance suites

Click to edit Master subtitle style

Getting Together in Numbers

28

2,500employees

400customers

15products

25offices

Financials

2929

Revenue – Continue our GrowthNon-GAAP Revenues (USD millions)

1 Revenues of $98.1 M in 2011 pro-forma for the FIS and IDIT acquisitions 30

70.3

114.2

135.4

157.5

179.3

216.2

98.1

2011 2012 2013 2014 2015 2016

(1)

Non-GAAP Revenues (USD millions)

+16.4%

+18.8%

+16.3%

+13.9%

YoY Growth

+20.6%

Annual Revenue by Geography

Non-GAAP Revenues (USD millions)

Focus on North America and Europe

31

35.5

26.622.4 23.6

12.5

44.2

31.1

24.923

12.2

49.6

35

28.4 28.8

15.7

61.3

42.6

26.528.3

20.5

74.5

46.9

35.5

29.1 30.2

NA UK EU Israel APAC

2012 2013 2014 2015 2016

Year 3 Year 4 Year 5 Year 6-10

Contractual High

Attractive Revenue Model

Ongoing Post-ProductionPre-Production

Year 1 Year 2

Go

-Liv

e

Typical life of product engagement: 10–15 years

Revenue ($mm)

Initial Deal Size

Stage

Stickiness

$7 - $10m$10 - $15m $8 - $10m $3 - $5m $1 - $1.5m

Retirement ReinsuranceL&A P&C Closed Books

32

With Significant VisibilityR

eve

nu

e

≈15%New Customers

≈85% Existing Customers

YEAR 1

YEAR 2

YEAR 3

YEAR 4

YEAR 5

Customer stickiness and layered revenue streams create significant visibility

33

Q1 Revenue and Operating profitNon-GAAP Revenue and Operating Profit (USD millions)

See appendix for Non-GAAP reconciliation.

$49.6

$56.5

0

0.02

0.04

0.06

0.08

0.1

0.12

0.14

Q1 2016 Q1 2017

34

$7.3

$1.7

14.8%

3.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

Q1 2016 Q1 2017

Strong Cash Flow Generation

$35.1M Cash

$40M Debt

Annual Non-GAAP Operating Cash Flow

Dividend Payments:$9.8m in 2016, $7.2m in 2015 and $6m in 2013

Non-GAAP operating cash flow include the cost of capitalized software development

15.3

11.915.4

34.4

20.5

2012 2013 2014 2015 2016

35

Cash and Debt as of March 31, 2017

2017 Guidance

36

Revenue and Operational Margin GuidanceRevenue Guidance Operational Margin Target

37

216

265

0

0.02

0.04

0.06

0.08

0.1

0.12

0.14

50

100

150

200

250

300

2016 2017 Guidance

13.7%

9%

0

2

4

6

8

10

12

2016 2017Guidance

275.0

37

Revenue Guidance Operational Margin Target

10%

Investment Highlights

3838

Financial and Investment Highlights

High growth Diversified revenue Well capitalize Attractive revenue model

39

Massive Market Technology Leader Top-tier customers Proven management

www.sapiens.com

Thank You

Contact: Yaffa Cohen-Ifrah, CMO & Head of Corporate Communications

Mobile: +1-201-250-9414 | Phone: +972-3-7902032Email: IR.sapiens@Sapiens.com | Website: www.sapiens.com

Q1 – Non-GAAP Results

** The Company defines Adjusted EBITDA as net Profit, adjusted for stock-based compensation expense, depreciation and amortization, capitalized internal-use software development costs, amortization of internal-use software development costs interest expense, provision for income taxes and other income (expenses). 41

Q1

20162017

49.656.5Revenue

21.620.5Gross Profit

43.5%36.2 %

7.41.7Operational Profit

14.8%3.0%

5.91.0Net Income

12.1%1.7%

7.92.5Adjusted EBITDA**

0.120.02Diluted EPS

49,56049,998Diluted Weighted Average Number of Shares

(in USD million, except per share amount)

Non-GAAP EBITDA to Adj. EBITDA Reconciliation

1 See definition of Adjusted EBITDA in Q1 2017 press release

42

Quarter ended March 31

20162017

6,251(1,637)GAAP operating profit

1,4091,021Amortization of capitalized software

5111,254Amortization of other intangible assets

(6,032)(1,065)Capitalization of software development

1031,670Compensation related to acquisition and acquisition related cost

458455Stock-based compensation

7,3481,698Non-GAAP operating profit

14.8%3.0%

607876Depreciation

7,9552,574Adjusted EBITDA1

16.0%4.6%

(in USD thousands)

Q4 and Annual – Non-GAAP Results

** The Company defines Adjusted EBITDA as net Profit, adjusted for stock-based compensation expense, depreciation and amortization, capitalized internal-use software development costs, amortization of internal-use software development costs interest expense, provision for income taxes and other income (expenses). 43

AnnualQ4

2015201620152016

179.3216.248.757.1Revenue

78.591.821.523.9Gross Profit

43.8%42.4%44.2%41.8 %

26.529.67.47.5Operational Profit

14.8%13.7%15.1%13.1%

22.124.26.36.0Net Income

12.3%11.2%13.0%10.4%

28.532.57.98.3Adjusted EBITDA**

0.450.490.130.12Diluted EPS

49,32749,78049,53649,935Diluted Weighted Average Number of Shares

Outstanding Shares: 49,036)as of December 31, 2016(

(in USD million, except per share amount)