Insurtech providers offer software which simplifies decision making for customers and analytic software which gives insurers data to understand market needs and demands. Valued at $532.7 million in 2018, the market size is expected to reach $1,119.8 million by 2021, growing at a CAGR of 16.0% in the 2018-2023 period.[1] Since 2014, the fundraise count in the Insurtech market has increased over 314%, with over 274 Insurtech funding rounds disclosed in 2020.[2]
Looking at the Insurtech M&A market, positive predictions are also being made here, with 39% of transactions closed between July 2019 and October 2020 being private equity acquisitions.[2] It is expected that M&A transactions will continue to grow thanks to the prosperity of this market, which is becoming more and more digital.
Even despite the impact of the Covid-19 pandemic, Insurtech has managed to maintain its impressive growth; with the implementation of social distancing measures, the move from in person to online insurance sales has accelerated.
Advances in data analytics and AI have made it easier for insurers to identify new markets or those who are underinsured or uninsured, and so the insurance industry is becoming more focused on the individual customer and better at matching the right insurance option to the customer.
[1] Article: ‘Insurance Technology (InsurTech) Market Study Reveals Growth Factors and Competitive Outlook for Future’
Source: menafn.com (15/11/2019)
[2] Article: ‘Insurtech ecosystem experiencing record-breaking fundraising level and M&A transaction volumes, says Hampleton Partners’
Source: privateequitywire.co.uk (1/12/2020)
