Global: Q2 sees investment of $917m into InsurTech
Source: Middle East Insurance Review | Sep 2023
As incumbent (re)insurers stepped-up their investment activity, new funding for the global InsurTech sector slipped to $916.71m during the second quarter of 2023, down 34.0% from $1.39bn in 1Q2023, pushing the quarterly total below $1bn for the first time in three years. However, average deal size fell by a much smaller degree – 16.1% – to $12.39m in 2Q2023, across only 97 investments, according to the latest Global InsurTech Report from Gallagher Re.
Early-stage funding was its lowest since 3Q2017. L&H early-stage investments totalled just $58.34m, while P&C early-stage funding slumped to $157.71m. The average deal size for the sub-category slid to $5.27m across 51 investments. Meanwhile, 17 ‘acceleration’ category deals attracted $134.49m, or 14.7% of total InsurTech funding for the quarter, a lower share than has been the norm. Only one 2Q2023 deal qualified as a mega-round, Baring’s $150m Series B investment in Accelerant, marking the third consecutive quarter with only one mega-round.
(Re)insurers made 43 InsurTech investments in 2Q2023, most in early-stage deals including 12 seed investments and 14 Series A investments. Munich Re Ventures led the activity with six, while MassMutual Ventures made five and Aviva Ventures, MS&AD Ventures, and Nationwide Ventures each made three.
Gallagher Re global head of InsurTech Andrew Johnston said, “During InsurTech’s primary phase, from 2012 to 2021, about $42bn was invested. The focus was on technology, the ‘how’ rather than the ‘what’ but up to a third of those InsurTechs no longer trade. M