Insurtech funding in Q3 passes $1.1bn milestone amid surge in P&C

The worldwide insurtech sector surpassed US$1.1 billion in new funding through the third quarter of 2023. This progress, representing a 19.8% enhance, was primarily propelled by a 25.5% quarter-on-quarter surge in property and casualty insurtech funding.

For its newest International Insurtech Report, Gallagher Re revealed that the surge occurred regardless of the typical deal dimension dropping by 16.4% to a six-year low of US$10.3 million. Moreover, life and well being insurtech funding skilled a 4.5% lower to US$166.6 million.

The report notes an increase within the variety of quarterly insurtech offers, surging from 97 in Q2 to 119 in Q3, marking the best depend since Q3 2022 (140). P&C insurtech witnessed 90 offers, and life and well being Insurtech noticed 29 offers. Notably, US-based insurtechs accounted for 55.4% of the worldwide insurtech deal share in Q3 2023, marking the best stage since Q1 2020.

Early-stage insurtech funding noticed a 24.7% quarter-on-quarter enhance to US$269.45 million, coupled with an increase in early-stage offers from 51 in Q2 to 71 in Q3. Nevertheless, the typical mid-stage Sequence B and C funding for the 12 months dropped to its lowest complete since 2014, standing at US$24 million. Firms falling into this class raised US$323.36 million, constituting 29.5% of complete Insurtech funding throughout 18 offers in Q3.

The quarter noticed two mega-round investments, with each the Boston-based owners’ insurance coverage platform Overtly and the San Francisco cyber platform Resilience securing US$100 million in Sequence D rounds.

Concerning (re)insurers’ involvement, the report reveals that 34 insurtech investments have been made within the quarter, primarily concentrated within the early-stage class (61.8%). Q3 noticed 10 seed/angel-stage investments and 11 Sequence A investments by commerce gamers. MassMutual Ventures led the exercise with seven investments, adopted by Avanta Ventures (a part of CSAA), MS&AD Ventures, and Munich Re Ventures, every making three or extra investments.

“We proceed to maneuver by means of an important inflection level of worldwide insurtech, from part one, the ‘nice experiment’ to part two centered on sustainable, worthwhile enterprise outcomes by means of precision, not quantity. The third quarter offered us with some very thought-provoking examples of what this alteration seems to be like at a person firm stage, for each insurtechs and traders,” mentioned Dr Andrew Johnston, Gallagher Re world head of insurtech.

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