Insurtech funding drops by 57% in Q4 2022: Gallagher Re

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By Favour Nnabugwu



Global insurtech investment declined by 57.0 percent to $1.01 billion in the fourth quarter of 2022, when compared with the previous quarter

According a einsurance broker, Gallagher Re Global InsurTech Report, shows that means that insurtech funding is at its lowest quarterly point since Q1 2020.

The situation is worst in the property and casualty sector, where Q4 funding slumped by 64.4 percent to $630.16 million, while total Q4 investments in life and health fell by 33.7 percent to $383.76 million.

The performance drove annual total funding for 2022 down by 49.5 percent from 2021, to $7.98 billion.

Gallagher Re also reports that average deal size across 106 rounds declined 42.3 percent to $11.79 million and that insurtechs attracted $6.51 billion less in mega-round funding – a 66.7 percent year-on-year drop. The most significant feature of 2022 is that the narrative around ‘disruption’ seems to be truly over.”

The report shows that the top seven recipient countries for insurtech investment in 2022 were the US, the UK, Germany, France, India, Israel, and Australia, all of which topped $200 million, but US companies, at $4 billion, received 35% more investment than the next six countries combined.

While conditions were broadly challenging, analysts note that a small number of individual businesses did perform remarkably well, with Combinator recording the highest number of individual deal, at 17 rounds completed, followed by Gaingels and Anthemis with 12 deals each

“2022 has prompted an exodus of third-party capital providers, causing the sector to refocus on the real prize: wider adoption of appropriate technology to make the entire process of insurance more efficient, cost effective, and less complex leading to an improved customer experience,” Johnston explained.

In terms of total investment value, Greycroft topped Gallagher Re’s list, having invested $699 million over nine transactions during the year. Next is OMERS Ventures with $592 million recorded, including a share of Q4’s only mega-round, for Clearcover. And third was Allianz X, with $565 million across three deals.

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