Global insurtech funding and deals slip to recent lows in Q2’23, while the M&A market picks up pace.
Following a spike in funding in Q1’23, global insurtech funding decreased 36% quarter-over-quarter (QoQ) in Q2’23 to $0.9B. Deal count fell for the third straight quarter, slipping below 100 for the first time since 2017.
Using CB Insights data, we dig into key takeaways from our State of Insurtech Q2’23 Report, including:
- Global insurtech funding falls below $1B for the first time since 2018
- Mega-rounds (deals worth $100M+) remain rare, with just 1 deal done in Q2’23
- Insurtech M&A exits grow 45% QoQ, reversing a recent slowdown
CB Insights clients can sign in and download the full report to see all the latest funding trends in insurtech.
Let’s dive in.
After a slight rebound in Q1’23, global insurtech funding continued its downward trend since 2021’s highs. Funding fell 36% QoQ — a less severe drop than fintech (-48%) but more than the overall VC market (-13%).
This was also the first time since Q2’18 that quarterly insurtech funding fell below $1B.
Parallel to the decline in overall funding, mega-rounds (deals worth $100M+) have become increasingly rare since 2021. Accelerant’s $150M Series B was the lone insurtech mega-round in Q2’23.
At the peak of insurtech funding in 2021, the number of mega-rounds typically exceeded 10 per quarter and made up about half of total funding. In contrast, the last 3 quarters each saw 1 mega-round, representing around 15% of funding.
After 2 quarters of decline, insurtech M&A activity rebounded in Q2’23, with exits increasing 45% QoQ to 16.
A number of Q2’23’s M&A deals went to high-profile, consumer-facing startups. Examples include Zinnia’s acquisition of Policygenius, Admiral Group’s acquisition of Luko, and Direct Line Group’s acquisition of By Miles.
CB Insights clients can see all the latest investment data by signing in and downloading the full State of Insurtech Q2’23 Report using the sidebar.