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Insurtech investments go up

3/6/2022

The insurance sector is facing unprecedented change in a rapidly evolving environment. It is hard to identify a sector with more buzz and disruption potential than insurtech.

The insurtech sector provides an attractive alternative for investors. In today's post-COVID world, technology companies continue challenging the old world order within the segment. Effective technology deployment progressively improves how insurance is purchased, and claims settled, with greater customer engagement and broker empowerment. New entrants continue to challenge incumbents at every turn.

Numbers don’t lie. There is constant investor activity in the insurtech sector, from large seed and early-stage financing to giant late-stage rounds, with a few exits from the first set of venture-backed insurance unicorns. Moreover, a growing number of non-traditional investors look at insurtech every year. Insurtech companies had a fantastic fundraising year in 2021, setting dollar and deal terms records. Global investment in insurance technology (insurtech) start-ups totalled $10.5 billion in the first nine months of 2021. By the end of the year, $15.4 billion of invested capital, counting over 566 deals, was an all-time record and a 90% gain over 2020. The first quarter of 2022 was not yet a dream come true for insurtech. In 2022 we have already seen some bumper investments in the insurtech space, with Branch recently attracting a $147 million Series C tranche at a $1.05 billion valuation. YuLife snagged $120 million at an $800 million valuation in early July 2022, not to mention wefox, with an additional $400 million obtained in 2022 in Series D after getting $650 million in Series C a year before. It seems like a slight downturn has fueled the growth potential for those who can prove to have what it takes to transform the market by demonstrating a track record of technology deployment and a steady track record of increasing profitable customer acquisition.

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Source: Efinity Insurance Group
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