Global insurtech quarterly funding up 71%, deals fall

Global insurtech funding in the second quarter reached $1.56 billion across 74 deals, up 71% from the first quarter of 2020, according to a report from Willis Towers Watson PLC on Tuesday.

Deal count, however, dropped 23% from the first quarter as investors move to later funding more mature companies with larger investments in later rounds, the broker said, including four instances of “mega-rounds” over $100 million.

“As we have been commenting on for some time now, investments are going further up the stage ladder… Early-stage deals, Seed/Angel and Series A, accounted for 42% of overall deal count, a record low, and a nine-percentage-point decline from Q1 2020,” Willis Towers Watson said in the report.

Property/casualty saw 68% of dollars invested this quarter totaling $1.06 billion, compared with 85% in the first quarter totaling $775.2 million.

Of these, 46% were described as distribution deals and 46% as business-to-business transactions, with carrier deals making up the remaining 8%, data from the report showed.

The U.S accounted for 48% of insurtech deals, followed by the U.K. at 21% and China at 5%, followed by a group of nations tied at 3%, data showed.

While the data shows upward trends, Andrew Johnston, global head of insurtech at Willis Re, cautioned against drawing conclusions on the market.

“While InsurTech investment clearly rebounded in Q2, and the trend towards greater commitments to later-stage fundraisings continues, we should be cautious and not read too much into the general state of the global InsurTech market based on this quarter alone,” he said in a statement issued with the report.