In-depth: InsurTech 2019

Statista Digital Market Outlook - Trend Report

The premiums of the global insurance market exceeded US$4.9 trillion in 2017 – a fact that has not gone unnoticed by start-ups that are hoping to disrupt yet another industry. The InsurTech wave does not only stand for a technological advance in the traditional insurance business, it also brings forth completely new business models like peer-to-peer, or microinsurances.

Find out what is going on in the InsurTech market, what the consumers think, and which companies are the major players in our report.

What's included?

  • Market segments & funding
  • Technological impact & trends
  • Consumer insights
  • Company deep dives: BIMA, Clover, Collective Health, Coverhound, Lemonade, Metromile, Oscar, Zhong An
  • Comprehensive list of start-ups

In the Statista Digital Market Outlook Trend Reports our analysts focus on hot digital market and compile a comprehensive collection of data, insights, and key player analysis. An overview of all Outlook Reports can be found here.

The Statista Digital Market Outlook presents up-to-date figures and forecasts on markets of the digital economy in over 50 countries and regions. The comparable key figures are based on extensive analyses of relevant indicators from the areas of society, economy, and technology.

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The insurance industry with global premiums exceeding US$4.9 trillion in 2017 is one of the most complex businesses around. Although late, the industry now appears to be at a key inflection point with many experts viewing the digitization of insurance as the next big opportunity after FinTech. The main factors driving the growth of InsurTech include an archaic distribution system, dwindling consumer trust in the incumbents, millennial appeal and most importantly, a huge commercial potential for start-ups offering new and relevant products. Overall investment in InsurTech start-ups increased from US$0.3 billion in 2013 to US$2.2 billion in 2017 at a CAGR of 69.2%. The investment reached US$2.7 billion at its peak in 2015.

Currently, technology is at the core of every insurer’s strategic imperatives. Emerging technologies are transforming the insurance landscape as they enable new methods of assessing and controlling risk, improving efficiency, engaging with customers, preventing fraud, personalizing coverage and delivering products. As such, connected devices have the biggest disruption potential with Smart Home devices having become highly important in property insurance. However, smart home gadgets are still very expensive and only 27% of U.S. households currently had a smart-home device in 2017, as per the Statista Digital Market Outlook.

According to Statista’s survey on InsurTech in the U.S., the UK and Germany in 2017, most consumers find traditional insurers like insurance companies and direct insurers trustworthy. Only about a fifth say that new market entrants like insurance start-ups and peer-to-peer insurances are fully or largely trustworthy. This applies to different insurances like car insurance, personal liability insurance, health insurance and home/homeowner‘s insurance. There are major differences between the three countries in terms of adoption of new insurers. The U.S. is ahead in adopting new digital business models in the insurance industry. With regards to tech giants foraying into insurance space, people in the UK more likely to accept insurances by these companies compared to those surveyed from the U.S and Germany.

Insurance companies are setting up accelerators and innovation hubs as well as digital garages or in-house innovation hubs to offer new products and services and optimize their existing offerings with the help of digital disruptions in InsurTech. Moreover, insurance companies and internet companies are making partnership arrangements to offer new products. Start-ups are playing a major role in digital disruptions, hence insurers are forming partnerships with start-ups from various industries

Both the traditional insurers and new age start-ups are using technologies to disrupt the insurance domain. Although, the phenomena is global, majority of the InsurTech companies mainly located in the U.S.. Bima, Clover, Collective health, Metromile, Oscar and Zhong An are leading the InsurTech innovations in the direct insurance segment of the industry, whereas San Franscisco based start-up, CoverHound is disrupting the market with the creation of an insurance marketplace. Lemonade, another New York based start-up is foraying into peer-to-peer domain insurance domain.

Majority of the InsurTech start-ups are mainly located in the U.S.. Highest number of start-ups are in the technology and marketplace segment. As of 2018, Oscar has raised highest amount of funding of US$1.3 billion by any InsurTech company from key investors such as Alphabet, Breyer Capital, Capital G, Fidelity Investments, Founders Fund and others. Start-ups such as Zhong An Insurance and Zenefits raised more than US$1.5 billion in total funding, whereas start-ups including Bright Health, Clover and Policy Bazar have raised more than US$400 million each as of now. Additionally, the company raised US$1.5 billion through its IPO on the Hong Kong Stock Exchange, in September 2017.

  • Language: English
  • Released: February 2019
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