Despite the challenges faced by the (re)insurance sector in 2020 and the relatively slow start to insurTech funding for the year, global investment in the sector reached a new accumulated annual high of US$7.1 billion for 2020, through 377 deals, the most in any year to date, according to the new Quarterly InsurTech Briefing from Willis Towers Watson.
Compared with 2019, total funding increased by 12%, while deal volume increased by 20%. insurTech’s raised $2.1 billion across 103 deals during Q4, with 67% of the funds attracted by property/casualty-focused firms. Life & health insurTech’s saw a modest decrease in deal share of 1.6 percentage-points in the quarter, and an 8.4 percentage-point decline in total funding over Q3, 2020.
Q4 fundraisings in excess of $100 million by later-stage companies Hippo, Unqork, Waterdrop, Oscar Health, Bind Benefits, and Newfront Insurance totaled $1.1 billion, as early-stage deals declined to 47% of the total from 57% in Q3, 2020. Mid-stage Series B or C deal flow surged somewhat to reach 29% of the total number. InsurTech’s from 23 countries attracted investor capital, including in previously dormant Hong Kong, Brazil, and Switzerland.
Dr Andrew Johnston, global head of InsurTech at Willis Re, said: “While our industry is facing extreme issues relating to COVID-19, we also have an unprecedented level of access to technology and technologists who can help it prevail during these times of instability. Many insurTech’s probably feel vindicated that the insurance industry has been forced to realize the value of technology. The issue for insurTech’s now is to survive months, possibly years, of market uncertainty.