Menu

Reinsurance News

Insurtech growth to remain unaltered by COVID-19: Aon COO

19th June 2020 - Author: Matt Sheehan

While investment in insurtech has seemingly been slowed by the ongoing COVID-19 pandemic, the macro growth trend in this space will likely remain unaltered by the crisis.

Fintech image via George Washington UniversityThis is according to John G. Bruno, Chief Operating Officer (COO) at Aon plc and Chief Executive Officer (CEO) for Data & Analytic Services, who looked at how the insurtech sector could be affected in a recent blog post.

Bruno acknowledged that the pandemic has caused a short-term dip in insurtech funding while investors wait for greater certainty.

But at the same time, he added, venture capital companies want to ensure that the start-ups they have already invested in have sufficient cash to continue their innovation projects through the crisis.

And importantly, many players in the re/insurance space recognise that the crisis can potentially stimulate innovation that increases resilience and promotes recovery.

Between 2014 and 2018, US insurtech investment grew from $400 million to $2.5 billion, according to Crunchbase, with global insurtech investment rising from $1.1 billion to nearly $4 billion over the same period.

And FT Partners found that insurtech benefited from approximately $6.8 billion in financing for around 250 transactions in 2019, plus $10.3 billion in the volume of mergers and acquisitions across over 100 transactions.

So while the pandemic has certainly put the brakes on insurtech funding, Bruno remains confident that the trend of growing investment in the sector will soon pick back up, particulalry as commercial businesses increasingly look to reorganise and reinvent themselves after COVID-19.

The food supply sector is one key area that this could represent a major opportunity for insurtech post-pandemic, and the COO pointed to other promising challenges such as medical insurance, the gig economy, and the need for more flexible supply chains.

“The global pandemic crisis is going to trigger another digital pivot – one that will see the InsurTech space attracting renewed VC and CVC investment flows,” Bruno concluded.

“The resulting solutions will help resolve the many dislocations created by the COVID-19 outbreak and will ultimately re-imagine how consumers and businesses interact with risk transfer solutions.”

Print Friendly, PDF & Email

Recent Reinsurance News

Getting your daily reinsurance news from Reinsurance News is a simple way to receive only the reinsurance industry news that matters, delivered directly to your email inbox.

  • Only email is mandatory, but the more you tell us about yourself the better we can serve you in future!
  • This field is for validation purposes and should be left unchanged.

By submitting the form you are giving your consent to be emailed by us.

Read previous post:
Probitas 1492 announces plans to launch a new managing agency

Probitas 1492, an underwriting Syndicate at Lloyd's of London, has announced plans to establish a new managing agent, Probitas Managing...

Close