The latest edition of Gallagher Re's Global InsurTech Report for Q2 2024 presents a comprehensive analysis of the evolving role of Artificial Intelligence (AI) within the reinsurance sector. As the second installment in a series focused on the integration of AI across the industry, this report delves into the intricacies of AI's impact on risk-related areas, including pricing, underwriting, and portfolio management.
This quarter's findings highlight significant trends in InsurTech funding and deal activity, underscoring a resurgence in the sector after a period of decline. Notably, Q2 2024 witnessed a robust increase in global InsurTech funding, reaching USD 1.27 billion, the highest level recorded since Q1 2023. This upward trend signals renewed investor confidence in the sector, particularly in early-stage companies, which saw funding rise to USD 377.60 million—the highest since Q1 2023.
Despite the surge in funding, the number of deals in Q2 2024 dropped to 82, marking the lowest quarterly count since Q2 2020. This apparent contradiction—rising funding with fewer deals—can be attributed to a nearly doubling of average deal sizes, which soared to USD 18.46 million, the highest since Q3 2022. This shift suggests a growing preference among investors for larger, more established InsurTech firms, or those with a strong focus on AI and risk management.
AI's growing influence in the InsurTech space is further highlighted by the fact that one-third of all Q2 2024 InsurTech deals were directed towards AI-centered companies. Additionally, 40% of the deals were concentrated on InsurTechs focused on risk management. This trend reflects the industry's increasing reliance on AI-driven solutions to enhance accuracy and efficiency in pricing, underwriting, and portfolio optimization.
Gallagher Re’s report also emphasizes the importance of InsurTech companies that are making significant strides in these areas. The spotlight on key players and insights from thought leaders provides valuable perspectives on the future of AI in reinsurance, offering a glimpse into how these technologies are reshaping the industry’s landscape.
In summary, Q2 2024 marks a pivotal moment for the global InsurTech sector, characterized by a resurgence in funding and a strategic shift towards AI-driven risk management solutions. As the industry continues to evolve, the role of AI is expected to become increasingly central, driving innovation and transforming traditional reinsurance processes.
Download the report on Gallagher Re's website
