InsurTech investments peak, more startups developing tools to manage cyber risk
Source: Middle East Insurance Review | Apr 2019
Sixty-three InsurTech deals with a total value of $1.59bn were announced globally in the fourth quarter of last year – the highest ever since the second quarter of 2015, according to the latest findings by Willis Towers Watson.
After rising for several years, the number of strategic InsurTech investments by (re)insurers declined by 6% from its peak in the second quarter of 2018, but funding increased significantly. Eleven insurance-sector investors ploughed $218m into InsurTechs in the fourth quarter of 2018, up 230% from the previous quarter. Currently the global industry maintains 31 strategic partnerships with technology companies, the highest number recorded.
Of note is the rise in the InsurTech community that looks to address cyber risk – driven by some major breaches and a growing supply and demand issue.
Willis Re’s global head of cyber Mark Synnott said, “There’s a healthy ecosystem of InsurTechs, insurers, reinsurers, and brokers working to quantify and price individual and portfolio cyber risk under affirmative coverage. More work needs to be done to address silent cyber, since potential accumulation exposure is enormous, but it is under way.”
Commenting on the value that InsurTechs can offer in mitigating cyber risk, Willis Re’s global head of InsurTech Dr Andrew Johnston said, “Cyber is a multi-faceted, ever-evolving phenomenon. The appropriate response to this is to task our industry with an equally multi-faceted approach. Rather than trying to specialise and excel in each tenet required, InsurTechs offer our industry a huge opportunity through strategic commercial partnering to allow incumbent insurance firms the ability to become part of a broader, more resilient jigsaw puzzle. M