Investors in insurance tech look beyond health insurance and beyond the US market as deal activity hits a multi-year quarterly high in Q4'15.
In 2014, insurance tech startups raised just over $740M in venture and equity funding. Just a year later, funding to insurance tech companies rose over 3.5x to hit $2.65B in annual funding, according to CB Insights data.
Funding spiked in Q2’15 on the back of mega-rounds to online benefits software and health insurance brokerage Zenefits and online P&C insurance seller Zhong An. More importantly, year-over-year deal activity in the growing insurance tech space increased 45% and hit a multi-year quarterly high in Q4’15, which saw an average of 11 insurance tech startup financings per month.
US insurance tech startups take smaller share of funding pie
US-based startups contributed just over half of all insurance tech funding in 2015, after taking over 80% of funding in 2014. US insurance tech deal activity hit a high in Q2’15, with financings in that quarter to companies including Oscar Health, SimplyInsured, Zenefits and Stride Health among others. Insurance tech deals in the US rose 35% year-over-year in 2015.
US insurance tech funding moves beyond healthcare
As we previously highlighted, insurance tech dealflow in the US has lately seen more activity in non-health insurance-related startups, including companies operating in the life and commercial insurance industries. 2015 saw health insurance startups take just 51% of all US insurance tech deals, compared with 70% in 2014.
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