At $1.68 billion, global InsurTech funding in the fourth quarter of 2025 increased by an impressive 66.8% over the prior quarter, the highest level of quarterly funding since Q3 2022, as investments in insurtech for the full year 2025 rose by almost 20% year-on-year to $5.08 billion, according to Gallagher Re.
The reinsurance broker’s latest global InsurTech report highlights a resurgence of sector funding in the final quarter of last year, driven by P&C insurtech investments rebounding, over 100 InsurTechs fundraising for the first time since Q1 2024, and the return of so-called mega rounds – which is when more than $100 million is raised in a single round.
Within P&C InsurTech funding, Gallagher Re highlights a 90.5% quarter-on-quarter increase to $1.31 billion, driven by mega rounds from the likes of CyberCube, ICEYE, Creditas, Federato, and Nirvana, who together secured $662.81 million in funding during the quarter.
During Q4 2025, overall deal count spiked 34.2% quarter-on-quarter to 102, while average deal size increased 20% to $18.84 million.
Early-stage funding also reached an 11-quarter high in Q4 2025, rising from $277.65 million in Q3 to $403.09 million, with contributions from P&C and L&H.
The strong, overall funding increase for the full year 2025 was mostly driven by a near doubling in the number of mega-round deals from six to 11. Gallagher Re reports that mega-round funding in dollar terms also increased by 53.2% year-on-year to $1.43 billion.
Interestingly, during 2025, Gallagher Re finds that insurers and reinsurers made more investments into InsurTechs than in any other year on record, with 162 deals announced.
“This suggests that (re)insurers are not only more comfortable investing, but also that they see InsurTechs as a route forward in their own strategies,” says the firm.
As artificial intelligence continues to advance and influence industries of all shapes and sizes, two-thirds of 2025’s InsurTech funding went to firms focused on AI, accounting for almost $3.3 billion across almost 230 deals.
In fact, AI-centered InsurTech firms raised $1.31 billion across 66 deals in Q4’25, with an average deal size of $22.14 million, slightly above the overall Q4’25 average. Throughout the whole of 2025, AI-centered InsurTechs raised $3.35 billion across 227 deals, 66% of funding and 62% of deals, respectively.
Andrew Johnston, Global Head of InsurTech at Gallagher Re, said: “AI is squarely the focus of most of the contemporary InsurTech world. Over time, we see AI becoming so integrated into InsurTech that the two may well become synonymous.
“The long term question that the industry must consider now is the ‘so what’ problem: as the implementation of AI starts to deliver efficiency gains, it is imperative that the industry works out how to best use all of this newly freed up time and/or resource.”
Freddie Scarratt, Global Deputy Head of InsurTech at Gallagher Re, added: “Historically, the sector has taken a prudent approach to innovation, relying on established actuarial tables and thorough underwriting processes to ensure stability.
“However, recent developments suggest that the sector is shifting gears, moving from gradual evolution to an accelerated adoption of advanced technologies.”
