With a record amount of money invested in a record number of rounds, the first quarter of 2021 indicates that the insurtech wave may be heading to new highs.
Insurtechs raised $2.55 billion in 146 deals, increases of 22% on the money side and 42% on the total deals side, from January through March 2021, according to CB Insights' quarterly Insurtech Briefing. The previous record for money raised was $2.53 billion in the third quarter of 2020, which was largely chalked up to pent-up demand after the COVID-19 pandemic put a damper on the previous quarter's activity. However, the new record indicates there may be more demand at work.
"The types of technology that are now making industry headlines are not exactly new, but widespread willingness to engage and adopt is now growing at an unprecedented rate," writes Dr. Andrew Johnston, Global Head of Willis Re InsurTech. "As the ice is being broken, and more trust and confidence is being garnered, the flow of fresh water into our industry is gathering momentum."
The quarter featured eight mega-rounds of more than $100 million.
There were emerging and halted trends in the big numbers. On the upswing: The continued internationalization of insurtech. U.S. insurtechs garnered 48% of the money invested in the quarter, down from a peak of 57% last year. However, bucking a shift where big rounds investing in emerging "winners" was the norm, the share of early-stage deals increased to 60% of the total, from less than half in the previous quarter.
