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The InsurTech market size is estimated to grow at a CAGR of 42.35% between 2023 and 2028. The market size is forecast to increase by USD 77.41 billion. The growth of the market depends on several factors, including the increasing need to improve business efficiency, the high influence of digitization and the increased need for greater customer satisfaction. InsurTech refers to insurance technology, where technological innovations are used to improve efficiency and savings from the conventional insurance industry model. Many venture capital firms are investing in InsurTech startups. InsurTech firms are leveraging the power of software to promote different insurance products and other portfolio management tasks. These startups offer platforms or technologies for insurance companies and can disrupt the less technologically savvy corporations. InsurTech platforms help insurance companies facilitate their operational efficiency. They can lower the cost of insurance products using InsurTech platforms.
The report includes a comprehensive outlook on the InsurTech market, offering forecasts for the industry segmented by Application, which comprises marketing and distribution, IT support, claim management, policy administration and management, and others. Additionally, it categorizes Deployment into on-premises and cloud and covers Geography regions, including North America, APAC, Europe, Middle East and Africa, and South America. The report provides market size, historical data spanning from 2018 to 2022, and future projections, all presented in terms of value in USD billion for each of the mentioned segments.
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The increased need for greater customer satisfaction is notably driving market growth. As the number of insurance companies is increasing year-on-year worldwide, customer satisfaction is one of the major drivers for this market. With the emergence of young customers, there is a need not only for insurance security support but also for personalized services. The entry of new players is predicted to intensify competition. The shift in demography has pushed many insurance firms to make use of actuarial and sales models for better pricing through the InsurTech platforms. The rise in the population of baby boomers and the emerging Generation Y are sparking growth opportunities for different insurance products.
Moreover, many customers prefer buying insurance policies online. This is because of the better technological support, timely service, information and advisory service, uniqueness in service, and seamless process of acquiring an insurance policy. Thus, many banks and insurance firms are trying to enhance the customer experience by investing in the latest and advanced technologies. This will open more opportunities for InsurTech providers, driving the growth of the market during the forecast period.
Investors collaborating with InsurTech firms is an emerging trend shaping the market growth. Investors are demonstrating an increased interest in collaborating with InsurTech firms or technology-first insurance startups. The conference was attended by around 1,500 investors, entrepreneurs, and insurance executives from across the world. The agenda was to discuss the effect of technology on the operations of the insurance industry. The use of technology has transformed the entire insurance value chain. Further, the importance of InsurTech is increasing at a rapid pace among insurance companies. In the next ten years, the entire insurance process is expected to become digital and will not require the involvement of any form of physical interference.
As a result, the market has witnessed an increase in investors' collaboration with InsurTech firms. For example, in October 2022, Moodys Analytics and Cytora entered into a partnership to provide the commercial insurance industry with a streamlined and informed understanding of risk. The growth of technological innovations in the insurance industry will drive the growth of the InsurTech market during the forecast period.
Regulatory and economic uncertainty is a significant challenge hindering market growth. Low commodity prices and a decline in the euro and yen provide an impetus to the global economy. However, low investment rates in many industrial and emerging countries, coupled with minimal inflation and stagnation in Japan and Europe, are inhibiting the global economy. Economic uncertainties have a derivative impact on the venture capital industry. The strong dollar, the Federal Reserve System raising the interest rates, and the slowdown of the European and Chinese economies have increased the market volatility. This will lead to an increased risk of foreign capital of both equity and debt. Regulatory bodies around the world come up with new laws and regulations based on the latest industry requirements.
However, the NAIC came up with the Own Risk and Solvency Assessment (ORSA), which is an add-on to the required assessment framework. They will have to analyze all rationally predictable and applicable material risks that may have an influence on the insurer's abilities to fulfil their customer's obligations. With the tightening of government regulations, vendors in the market will face the challenge of increased prerequisites for the insurance industry. This would pose a challenge to market growth during the forecast period.
The market share growth by the marketing and distribution segment will be significant during the forecast period. The marketing and distribution segment will grow exponentially. The increasing use of smartphones and the ease of access to the Internet through smartphones have bolstered digital marketing and digital distribution of insurance policies through advanced technologies.
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The marketing and distribution segment was the largest and was valued at USD 2.35 billion in 2018. The popularity of InsurTech startups has sparked a wave of disruptive new players that are working to create more access, enhance transparency, and lower the costs of financial services. This creates a contrast to the modes of operation that traditional banking institutions and investment firms endorse. High levels of automation driven by advances in pattern recognition algorithms and predictive coding should lower the industry's overheads and establish greater efficiency in processes. Furthermore, the deregulation of equity crowdfunding and private startup investments are attracting investors to the market. Such factors are expected to drive the growth of the marketing and distribution segment in the InsurTech market during the forecast period.
The on-premises segment accounted for the largest share of the InsurTech market, and the trend is expected to continue during the forecast period. The growth of this segment can be attributed to the following unique properties of the on-premises deployment model: In the on-premises deployment model, the company's operations only depend on the in-house server, IT infrastructure, in-house IT team, and intranet. The organization has complete control over these components and can resolve any problem that arises. Further, the Insurtech market is mainly operated by large organizations that consider data privacy and security a priority. Data leakage can be disastrous for stakeholders' interests and the reputation of an organization. These organizations focus more on functionality than on cost-effectiveness. The high security and data privacy offered by the on-premises deployment model drive market growth during the forecast period.
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North America is estimated to contribute 51% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. Being a pioneer in the early adoption of technologies across industries, North America is an attractive region for the market. The region has a few of the world's most advanced economies that are pioneers in data generation and consumption. The expanding insurance and banking industries in North America need high-level analytics. This is a significant growth factor for the InsurTech market in the region. In North America, traditional insurance services are at risk. This is because of the presence of a significant number of new technology-enabled entrants.
In addition, a significant number of partnerships, acquisitions, collaborations, and competitions will occur during the forecast period. In the region, many technology startups are coming up in Silicon Valley. This is expected to increase the insurance business and demand to upgrade business processes with advanced technologies. This, in turn, would enhance the insurance underwriting procedures. The insurance firms would provide different insurance products to individuals as well as startup businesses with the help of Big Data analytics. Such factors are expected to drive the regional market growth during the forecast period.
The InsurTech Market report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global InsurTech Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Acko Technology and Services Pvt. Ltd. - The company offers InsurTech such as health insurance plans under its subsidiary called Acko General Insurance Ltd.
Charles Taylor Ltd. - The company offers InsurTech that helps global insurance businesses drive change through the delivery of technology-enabled solutions.
Cuvva Ltd. - The company offers InsurTech such as flexible niche car insurance insurtech.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The InsurTech market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018-2028
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InsurTech Market Scope |
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Report Coverage |
Details |
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Page number |
167 |
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Base year |
2023 |
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Historic period |
2018-2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 42.35% |
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Market Growth 2024-2028 |
USD 77.41 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
40.22 |
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Regional analysis |
North America, Europe, APAC, Middle East and Africa, and South America |
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Performing market contribution |
North America at 51% |
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Key countries |
US, China, India, UK, and France |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
Acko Technology and Services Pvt. Ltd., Allianz SE, Berkshire Hathaway Inc., Charles Taylor Ltd., Cuvva Ltd., Cytora Ltd., DeadHappy Ltd., Flock Ltd., Friendsurance, Kin Insurance Technology Hub LLC, KYND Ltd., Laka Ltd., Massachusetts Mutual Life Insurance Co., Milvik AB, Nimbla Ltd., Quantemplate Technologies Inc., simplesurance GmbH, Slice Insurance Technologies Inc., Uinsure Ltd., Urban Jungle Services Ltd., Wrisk Ltd., ExtraCover Ltd., and F2X Group Ltd. |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Deployment
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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