Digitalization and insurance: the importance of insurtechs and startups

To meet public interest in new technologies, startups have taken the gamble to create innovative tools. Insurers and reinsurers then joined forces with these young dynamic companies, which took the name of insurtech.

digitalisationThese companies have been designed to improve the entire value chain of insurance companies.

Volume of investments in insurtechs

Investments in insurtech are colossal. They have risen sharply in recent years, from 130 million USD in 2011 to more than 6.3 billion USD in 2019 with 314 transactions reported.

Despite a year of global economic crisis due to Covid, the number of transactions reported at the end of the third quarter of 2020, amounts to 275 transactions for an investment amounting to 5 billion USD.

Number of transactions and volume of investments in insurtechs: 2012-Q3 2020

insurtechs transactions investments

Transactions breakdown per country

By the third quarter of 2020, nearly 60% of the transactions were concluded outside the United States, thus reinforcing a trend already observed previously.

Investments in insurtech are increasingly scattered around the world, with the number of transactions having increased by 50% in the UK and by almost 45% in the US. In China, however, their number declined by 38% in the first quarter of 2019.

insurtechs transactions country

Investment breakdown per sector

Most of the investments are made in non-life insurance, particularly in the health and motor classes of business. Although these investments are mainly in marketing and distribution, they tend to grow in the areas of analysis and underwriting.

The insurtechs are gradually invading all fields of insurance.

Non life insurtech transactions per class of investor

insurtech non life

Health and life insurtech transactions per class of investor

insurtech life
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