March 6, 2018
Q4 2017 Insurtech Briefing
Below are highlights found in the Q4 2017 Willis Towers Watson, Willis Re and CB Insights Insurtech Briefing.
- Insurtech funding during Q4 2017 totaled $697 million, a 123 percent increase from Q3 2017 and 157 percent increase from Q4 2016.
- The conversation shifted throughout 2017 from disrupting the value chain to enabling it through efficiency-driven innovation. According to McKinsey & Company, 61 percent of Insurtechs aim to enable the value chain while 30 percent attempt to disintermediate and 9 percent target full-scale disruption. This could be due to incumbents’ tendency to support development of less radical innovation or because Insurtechs have realized the high barrier to entry surrounding the insurance market.
- Incumbents have invested heavily in Insurtechs and technology, taking an active role in collaboration and partnerships. Thirty-five (35) private technology investments were made by (re)insurers in Q4 and 120 in 2017, the highest totals recorded in any quarter and year to date.
- There are four leading categories driving Insurtech activity and evolution. They are Product and Distribution (includes 256 companies = 57 percent of Insurtech market), Business Process Enhancement (includes 100 companies = 22 percent of Insurtech market), Data & Analytics (70 companies = 15 percent of Insurtech market) and Claims Management (25 companies = 6 percent of Insurtechs).
- More than 55 percent of participants say in the (re)insurance innovation survey marketing & distribution, underwriting, customer service, claims and customer retention are “extremely” or “very” in need of innovation at their company.
Read the details including the top 100 Insurtechs to watch (25 each in the four main categories above).
*Editor’s Note: There is not yet universal agreement on how to spell “insurtech.” The Council does not use a capital ‘t’ (yes, we used to) but in our summary of the Willis Towers Watson briefing report, we intentionally used the “Insurtech” spelling to align with the report.
Think Tank: Accelerator Programs Offer Access to Innovation
“When I arrived in Hartford, I was thinking, wow, there’s got to be a lot of stuff going on,’’ Paul Tyler says. “I started reaching out to a lot of people to see what was happening, and it was very, very quiet, just kind of waiting for somebody to throw a match.”
Two years later, a match has been thrown. Helped by a grant from the state of Connecticut and investments from several major Hartford insurance carriers and other investment groups, Hartford Insurtech Hub opened in January.
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