Global insurtech investment soared to record high in 2020: WTW

Investments in insurtech ventures reached a new accumulated annual high in 2020 despite the unprecedented challenges faced by the re/insurance industry due to COVID-19 and a relatively slow start to the year, according to Willis Towers Watson.

The insurtech industry attracted $7.1 billion global investment in 2020, inking 377 deals — the highest in any year to date. Compared with 2019, total funding increased by 12 percent, while deal volume increased by 20 percent.

During the fourth quarter of 2020, insurtechs raised $2.1 billion across 103 deals, with 67 percent of the funds attracted by property/casualty-focused firms.

Meanwhile, life & health firms saw a modest decline in deal share of 1.6 percentage-points in the quarter, and an 8.4 percentage-point decline in total funding over Q3, 2020.

WTW report found that the share of early-stage deals declined to 47 percent of the total in Q4. Mid-stage deals, however, saw a significant uptick with 29 percent of deals at the Series B or C stage.

Later-stage companies, including Hippo, Unqork, Waterdrop, Oscar Health, Bind Benefits and Newfront Insurance, each received in excess of the $100-million-dollar “mega-round” funding mark, creating six mega-rounds for the quarter. These six rounds combined totaled $1.1 billion in funding.

The report noted that insurtechs from 23 countries attracted investor capital, including in previously dormant Hong Kong, Brazil, and Switzerland.

Andrew Johnston, global head of insurtech at Willis Re, said: “While our industry is facing extreme issues relating to COVID-19, we also have an unprecedented level of access to technology and technologists who can help it prevail during these times of instability.

"Many InsurTechs probably feel vindicated that the insurance industry has been forced to realize the value of technology. The issue for InsurTechs now is to survive months, possibly years, of market uncertainty."

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