Gallagher Re’s latest Global InsurTech Report found that InsurTech funding surged to $2.44bn in Q2 2026, the highest quarterly total since Q2 2022, with AI-focused companies attracting 99.1% of all funding during the period, raising $2.42bn across 95 deals.
What’s more, according to Gallagher Re, every funding round in Q2 2026 above $5m went to an AI-focused company, further demonstrating the growing convergence between AI and InsurTech.
“While funding volumes rebounded sharply, the number of companies attracting meaningful investment continues to narrow. InsurTech funding was increasingly concentrated in a smaller group of investable businesses, with much of the quarter’s growth driven by large venture capital and private equity-backed funding rounds rather than capital from (re)insurers,” the firm explained.
(Re)insurance companies participated in 27 technology investments during the quarter, although the recovery in overall funding was primarily driven by venture capital and private equity investors rather than insurer-backed capital.
Q2 2026 also reportedly saw a significant return of the “mega-round”, with ¢1.67bn raised across ¢100m+ transactions, marking the strongest quarter for large-scale InsurTech fundraising since Q4 2021.
Other notable funding trends from Gallagher Re’s Q2 2026 report include quarterly deal count rising to 107 transactions, the highest level since Q1 2024, while early-stage funding fell 51.8% quarter-on-quarter despite relatively strong deal activity.
Andrew Johnston, Global Head of InsurTech at Gallagher Re, commented, “Capital availability is clearly not a problem. And yet we are seeing something of a paradox: at a time when AI is supposed to be making things cheaper, individual InsurTechs seem to be raising, then burning through, more cash than ever.
“The strongest AI-focused InsurTechs will either help incumbent (re)insurers deploy AI safely and measurably across insurance workflows, or use AI to attack parts of the insurance value chain that incumbents are too slow to transform.”
Alongside funding trends, Gallagher Re’s report also examined the rapid expansion of the infrastructure powering the AI economy, particularly data centres.
The firm said, “While AI software has dominated industry discussion over the last three years, attention is now turning to the physical infrastructure that makes AI possible and the opportunities and challenges this presents for the global (re)insurance industry.
“As AI adoption accelerates, global investment in data centre infrastructure is forecast to reach trillions of dollars over the coming years. These facilities are becoming some of the largest, most complex, and most valuable assets insurers have ever been asked to underwrite. Unlike traditional commercial property risks, data centres create exposures across multiple insurance lines and throughout the entire project lifecycle.
“Coverage considerations can begin before physical construction starts, with financing, permitting and environmental liabilities.
“Risks then extend through the transport of high-value chips, servers and specialist equipment, construction and commissioning phases, and ultimately into live operations where cyber incidents, service interruptions, power failures and business interruption losses can all arise.”
Gallagher Re underlined several emerging challenges for the market, including AI-optimised data centres reaching asset values of tens of billions of dollars, significant accumulation risk from geographically clustered facilities, new business interruption exposures arising from power, cooling and operational failures, growing demand for parametric and service-level agreement (SLA) insurance products, and the need for insurers and reinsurers to adopt engineering-led underwriting approaches that account for the interdependence of physical and digital risks.
Johnston concluded, “The AI boom is creating one of the largest new pools of insurable assets the industry has seen in decades. Every major data centre being built today will require insurance during construction and throughout a multi-decade operational life.
“The opportunity is enormous, but success will depend on understanding how risks move between traditional classes of business. The winners will be those that can take a holistic view of the entire lifecycle, from transporting the chips and equipment, through construction and commissioning, to live operations supporting some of the most important digital services in the world.”
