Global insurtech investment in the fourth quarter of 2022 fell 57% quarter-on-quarter to $1.01 billion, the lowest quarterly level since the first quarter of 2020, according to the Global InsurTech Report on Thursday from Gallagher Re, Arthur J’s reinsurance broker. Gallagher & Co.
Fourth-quarter property/casualty funding fell 64.4% to $630.16 million, and life and health investment fell 33.7% to $383.76 million, Gallagher Re said.
The sector has also seen its numbers and staff shrink, according to Gallagher Re, which estimated that at the end of 2019 there were almost 3,000 global insurers. “We estimate that there are currently 2,050 companies actively open for business,”; the report said, a decline of about a third.
In the same way, “layoffs of staff have been deeply visible. In some extreme cases, insurers have laid off up to 40% of their employees, which for larger insurers can translate to 300 to 500 people in one fell swoop,” the report said.
The US saw the lion’s share of funding at 49%, followed by the UK at 8% and China at 6%. No other nation saw more than 4% of quarterly insurtech funding, according to Gallagher Re data.
For the full year 2022, the top seven recipient countries for insurtech investment were the US, UK, Germany, France, India, Israel and Australia, all of which topped $200 million. However, US companies, with $4 billion in funding, received 35% more investment than the next six countries combined, Gallagher Re said in a statement accompanying the report.
In the property/casualty segment, 55% of funding went to distribution, 42% to business-to-business and just 3% to insurers, according to data from Gallagher Re.
Qualitatively, the report suggested a continued development towards cooperation and away from the pure “interruption” rhetoric of recent years. “What is possibly most important about 2022 is that the narrative around ‘disruption’ really seems to be over.”