Global investment in the insurance technology (insurtech) industry surged in 2017, with Europe emerging as a new insurtech hub outside the U.S., according to new research from global professional services company Accenture.
The research, which includes new analysis of data provided by global venture-finance analytics firm CB Insights data on insurtech deals over the last year, appears in a new Accenture report titled Fearless Innovation: Insurtech as the Catalyst for Change Within Insurance.
According to the report, the number of insurtech deals increased 39% globally in 2017, with the total value of deals up 32%, to US$2.3 billion.
While North America still leads in terms of both the total value and number of deals — accounting for US$1.24 billion, or 46% of deals last year — the number of deals there grew only 6% in 2017.
In Europe, however, the number of deals increased 118%, accounting for one-third of all insurtech deals globally, and the total value of deals there jumped an astounding 385%, to US$679 million.
Asia-Pacific saw a significant increase in funding, with a 169% rise in deal values, to US$358 million, with the number of deals rising 27%.
“The insurtech industry’s rapid growth reflects investors’ response to consumer appetite for change in an industry sitting on trapped value,” says Roy Jubraj, Accenture’s UK and Ireland Insurance Strategy and Innovation lead, in a statement.
The research reveals that property and casualty was the most popular insurance segment for insurtech investments in 2017, accounting for 42% of global investments, with multiline (26%) and health (18%) rounding out the top three. Personal lines accounted for more than two-thirds (68%) of insurtech investments, with commercial lines and mixed applications accounting for 26% and 6%, respectively.
Marketing and distribution led all areas in terms of insurtech investment, accounting for more than half (53%) of deals globally.
“Insurtech is no longer just a target for private equity and venture capital — it’s a global phenomenon,” said Michael Costonis, who leads Accenture’s Insurance practice globally, in a statement.
“Insurers are playing a big role in helping reshape the technology landscape across the industry, making investments beyond wearables and telematics to seize the opportunity that exists within distribution to strengthen the customer experience,” he adds.