The insurtech sector is growing throughout the world: on the one hand, companies are increasingly confident about the opportunities offered by new technologies, are making greater investments in their digital conversion and innovation and are looking to the world of startups. On the other hand, the insurance market has opened up to new players, as technology is enabling new business models with lower costs and the possibility of greater returns for investors.
The United States has always dominated the market in insurtech (as in other tech fields), but according to Accenture research Europe is the new player with an extraordinary increase: with transactions up by 385% (to 679 million dollars) and a volume up by 118% (a third of all insurtech transactions worldwide), Europe is making a marked comeback. The UK, despite the uncertainty caused by its exit from the European Union, is still rising as the European centre of insurtech, with London as its main hub, with 41 transactions in 2017 and an overall growth of 117% in the last two years. In 2017, the value of transactions grew tremendously, with $364 million invested in UK insurtech startups, compared to $19 million a year before.
Daniele Presutti, Senior Managing Director, Insurance Lead for Accenture Italy, said:
“Insurtech has undergone a significant global evolution. Born in the United States, in the last four years InsurTech’s focus has shifted to the rest of the world and to Europe in particular – while in 2014 the U.S. market represented 80% of the market compared to 12% in Europe, in 2017 Europe represented 32% of global investments while the U.S. market share dropped to 46%. Insurtech growth clearly proves how these initiatives are now an integral part of insurance companies’ investments, as part of a broader innovation strategy that at Accenture we consider essential to ensure profitable growth in a rapidly developing market environment. The challenge for companies is to create new experiences for customers that can be “hyper-relevant” that is, to respond and perhaps predict the daily needs of consumers with simple and customized solutions through the introduction of technological innovations. The Insurtech start-ups, even if still a not huge trend (in 2017 Insurtech is worth 2.3 billion dollars compared to 4.2 trillion dollars in the insurance market), can surely set new market standards for companies”.
North America still leads both in overall value and in volume of transactions – equal to 1.24 billion dollars, 46% of the transactions last year – but recorded an increase of only 6%..