PriyaPatel
TLDR:
- Insurtech funding saw a notable increase in Q2 2024, reaching $1.27 billion globally.
- Despite the funding increase, the number of insurtech deals dropped to 82, the lowest since Q2 2020.
Gallagher Re’s insurtech report for Q2 2024 highlighted key trends in the industry. Insurtech funding experienced a significant increase, with global investments reaching $1.27 billion, the highest level since Q1 2023. Early-stage insurtech funding also saw a rise, totaling $377.60 million, the largest amount since Q1 2023. The average deal size rose to $18.46 million, the highest since Q3 2022. Despite the funding increase, the overall number of insurtech deals dropped to 82, marking the lowest quarterly count since Q2 2020. One-third of the deals in Q2 2024 involved AI-centered InsurTechs, while 40% focused on risk-related technologies.
In the first half of 2024, a strong industry focus on supporting technology businesses persisted, despite a downturn in global insurtech investments. The lack of mega-round deals in Q1 led to lower overall totals, with more realistic valuations and a more democratized distribution of investor capital. The increase in average deal sizes in Q2 2024 was highlighted by Sidecar Health’s $165 million Series D round, making it the highest funding quarter since Q1 2023.
The article also noted a decline in the number of deals in both property and casualty (P&C) and life and health (L&H) sectors. However, early-stage deal sizes reached their highest level since Q1 2022, rising 77.8% quarter-on-quarter to $8.58 million. P&C insurtech funding increased from $605.58 million in Q1 to $853.92 million in Q2, with L&H insurtech funding also growing.
AI-centered insurtechs attracted significant funding in Q2, with $445.81 million invested across 27 deals. Notable deals included Sidecar Health’s Series D round and ICEYE’s Series D. Additionally, there were 33 tech investments by (re)insurers in Q2, with key partnerships formed between insurers and technology companies.
