In a recent article, XL Innovate’s Martha Notaras said that a combination of large cash positions and pressure from by “changing consumer preferences and advancing technology” was catalyzing insurers into investing in and participating in proof of concepts with tech startups.
While private tech investments by (re)insurers globally is indeed climbing to new highs, we wondered whether the same rang true among the largest P&C insurers in the US? Specifically, we looked at the top 25 P&C insurance groups ranked by direct premium written in 2015. As the chart highlights below, the list is led by State Farm, Allstate, and Berkshire Hathaway all with $30B+ direct written premiums in the given year.
When comparing the list of top P&C insurers with tech startup investments made since the start of 2015, we see that just 10 of the top 25 largest US P&C insurance groups had made a disclosed investment.
USAA has made the most new startup investments over the period, followed by American Family (primarily through its venture arm American Family Ventures). Liberty Mutual and Assurant each made 5+ startup investments over the period. It’s worth noting this data does not include any commitments by insurers into insurance-focused VC funds. QBE recently disclosed efforts to earmark $50M investment funds toward insurance-focused startups.
A handful of startups now count multiple P&C carriers among the top 25 by premiums as strategic investors. More recently, these include Dispatch Technologies, a software platform for home services professionals, Sure, a digital travel, renters, and smartphone insurance brokerage startup, Snapsheet, a virtual auto claims operations startup, and Weather Analytics, a weather and risk software company backed by W.R. Berkley and Tokio Marine.
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