Insurtech investment levels off, but still strong

Money flowed into startup companies at greater than a billion-dollar clip for the fourth consecutive quarter, according to Willis Towers Watson's latest Quarterly Insurtech briefing.

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In all, 69 deals with a total value of US $1.41 billion were announced in the time period. While this is 2% lower than the previous quarter in terms of dollars, it's nearly triple the same period from last year, despite fewer deals being reached overall. That's attributable to an increase in late-stage funding rounds as the sector matures, according to Dr. Andrew Johnston, Global Head of Willis Re InsurTech and the Quarterly Briefing Editor.

The large funding rounds have drawn the attention of the wider fintech market. In its Pulse of Fintech for the first half of 2019, KPMG reports that "The strong pace of investment showed no sign of easing in the first half of 2019. One shift seen in insurtech investment during the first half of 2019 was the spread of investments, with deals expanding beyond P&C and life insurance and into complementary segments such as payments."

Both Willis Towers Watson and KPMG noted a slowdown in U.S. and Americas insurtech investment, with KPMG attributing it to consolidation across the industy. "Once this consolidation settles, there will likely be renewed onterest in the insurtech space" in the U.S., the company continues.

Research also shows that insurtech is gaining traction among consumers. It is the second-most adopted fintech category out of five measured by EY, jumping from fourth place in 2015.

"Here, non-financial services organizations often facilitate consumer... adoption, such as equipping cars with 'black boxes' to provide data for telematics insurance or providing apps on mobile phones that consumers can use to count steps and gain fitness discounts on their health insurance," EY writes in its Global Fintech Adoption Index.

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