Insurtech funding proves to be bulletproof.

Despite coronavirus ravaging many an industry in Q2 2020, insurtech
funding has remained strong.

According to Forrester in its Insurtech Funding Roundup, insurtech funding
increased by 36% in Q2 2020, from $884m in the previous quarter to $1.2bn.

While not reaching the heights of Q3 2019 ($2.07bn) or Q4 2019 ($2.06bn), the rise shows that trust is coming back.

In addition, nearly 90% of the investments in 2020 have been early stage rounds of funding. Investors are incredibly willing to get in on the ground floor rather than wait. Insurtech has proven fruitful before, so firms are not hanging around. They are moving quickly.

April witnessed 40% of the quarter’s transactions, but only 21% of total funds raised in the period. Furthermore, the average size of transactions increased from $16m in April to $46m in June.

Insurtech funding proves to be bulletproof.

Despite coronavirus ravaging many an industry
in Q2 2020, insurtech funding has remained strong.

According to Forrester in its Insurtech Funding Roundup, insurtech funding increased by 36% in Q2 2020, from $884m in the previous quarter to $1.2bn.

While not reaching the heights of Q3 2019 ($2.07bn) or Q4 2019 ($2.06bn), the rise shows that trust is coming back.

In addition, nearly 90% of the investments in 2020 have been early stage rounds of funding. Investors are incredibly willing to get in on the ground floor rather than wait. Insurtech has proven fruitful before, so firms are not hanging around. They are moving quickly.

April witnessed 40% of the quarter’s transactions, but only 21% of total funds raised in the period. Furthermore, the average size of transactions increased from $16m in April to $46m in June.

Insurtech funding
proves to be
bulletproof.

Despite coronavirus
ravaging many an industry in Q2 2020, insurtech funding has remained strong.

According to Forrester in its Insurtech Funding Roundup, insurtech funding increased by 36% in Q2 2020, from $884m in the previous quarter to $1.2bn.

While not reaching the heights of Q3 2019 ($2.07bn) or Q4 2019 ($2.06bn), the rise shows that trust is coming back.

In addition, nearly 90% of the investments in 2020 have been early stage rounds of funding. Investors are incredibly willing to get in on the ground floor rather than wait. Insurtech has proven fruitful before, so firms are not hanging around. They are moving quickly.

April witnessed 40% of the quarter’s transactions, but only 21% of total funds raised in the period. Furthermore, the average size of transactions increased from $16m in April to $46m in June.

Most of these funds (62%) went to digital insurers. Forrester expects this trend to continue as consumers, insurers, and investors are used to digital transactions now. Also, 33% of investment went to enablers of operational improvement such as Betterview, with geospatial analytics. Another 5% went to comparison marketplaces.

The report stated: “Digital insurers are where the disruption lies within insurtech. These companies leverage emerging technology like artificial intelligence and mobility to innovate how insurance is bought, sold, used, and experienced. Disruptors Alan, Bestow, and Coalition all received investments of greater than $50 million in Q2 2020. Furthermore, Lemonade’s recent IPO revealed the fascination these start-ups garner — and there are more in the queue building toward an IPO, such as Hippo, which recently closed a $150 million financing round.”

What remains constant is the US’ involvement. According to the report, since 2010, the US has been the most active region for insurtech investment at 53% of transactions. In terms of dollars invested, 72% of investments have been into US-based insurtechs.

Despite COVID-19 throwing everything in the air, insurtech is still holding onto momentum and after a small blip in Q1 2020, is continuing its rise. Firms are not waiting to invest either. If there is a second wave of coronavirus, some may wish they held fire.

Patrick Brusnahan, Editor
Patrick.brusnahan@verdict.co.uk