Investment in Insurtech Industry Surged in 2017, With Europe Emerging As Key Insurtech Hub, Accenture Analysis Finds
Global investment in the insurance technology (insurtech) industry surged in 2017, with
The research, which includes new analysis of CB Insights data on insurtech deals over the last year, appears in a new Accenture report titled "Fearless Innovation: Insurtech as the Catalyst for
According to the report, the number of insurtech deals increased 39 percent globally in 2017, with the total value of deals up 32 percent, to
While
Number of insurtech deals by region
Despite the uncertainty around the
The report argues that insurtech should serve as a catalyst for innovation across the insurance industry, but traditional insurers must recognize that collaborating with insurtech startups is just one part of this process. Ultimately, innovation needs to become engrained throughout their organizations.
"The insurtech industry's rapid growth reflects investors' response to consumer appetite for change in an industry sitting on trapped value," said
The research reveals that property and casualty was the most popular insurance segment for insurtech investments in 2017, accounting for 42 percent of global investments, with multiline (26 percent) and health (18 percent) rounding out the top three. Personal lines accounted for more than two-thirds (68 percent) of insurtech investments, with commercial lines and mixed applications accounting for 26 percent and 6 percent, respectively.
From a value chain perspective, marketing and distribution led all areas in terms of insurtech investment, accounting for more than half (53 percent) of deals globally. This is evident in the number of startups pitching slick, app-based sales and distribution experiences, as well as those improving the customer claims journey through mobile photo-evidencing or chatbot First Notification of Loss.
The report reveals that traditional insurers are quickly getting behind emerging technology companies, as the percentage of traditional insurers' participating in venture capital investments is up 63 percent over the last five years. The most common areas for these investments were health and digital health (14 percent of such investments), the internet of things (13 percent), and big data and analytics (9 percent).
"Insurtech is no longer just a target for private equity and venture capital -- it's a global phenomenon," said
Methodology
Accenture analyzed insurtech investment data from CB Insights, a global venture-finance data and analytics firm. The analysis included global financing activity from venture-capital and private-equity firms, corporations and corporate venture-capital divisions, hedge funds, accelerators, and government-backed funds. The investment data ranged from 2010 through 2017 and included equity and non-equity financing.
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