Disclaimer: On January 14th, 2021, Porch.com acquired a company called Homeowners of America, making it one of the largest InsurTech companies. When looking at Porch and HOA combined for the full year 2021, Porch expects over $270 million of pro forma Gross Written Premium.

What is InsurTech? Broadly speaking, it’s an industry within Software/IT that specializes in insurance. Online services that let you compare insurance policies, companies that use AI to process your claim, and legacy insurance companies becoming increasingly digital – all fall under the broad umbrella of InsurTech.

Having emerged around 2010, this industry is now a burgeoning space, with over 2,000 companies and $3.5 billion in venture capital funding raised just last year.

But just how big is the rise of InsurTech for the insurance industry? And how is it going to impact consumers looking to get the best value for money on their insurance premiums? 

To determine the answers to all these questions and more, we looked at the latest industry reports and profiled the InsurTech startup and investment landscape on CrunchBase. Here’s what we know about the state of InsurTech as we enter the new decade.

Key Findings

    • There are up to 3,475 InsurTech companies globally
    • Over 1,500 InsurTech companies emerged in the last five years
    • InsurTech companies raised $5.4B in VC funding in 2020
    • VC funding for InsurTech companies in the last decade was growing at an average of 89% every year
    • There were 81 InsurTech acquisitions in 2020 – highest number on record
    • 15 out of the top 20 InsurTech companies by VC funding are based in the U.S.
    • 44% of all InsurTech companies in the world are in the United States

A Brief History of InsurTech

Like with FinTech and EdTech before it, InsurTech emerged when a number of companies started using innovations in software and tech to improve, enhance, and disrupt the age-old insurance industry. 

InsurTech innovations include but aren’t limited to:

  • Big data technologies helping insurers cope with the volume of claims 
  • Machine learning algorithms used in detecting insurance fraud
  • Smart devices installed on cars to gather driving data and assess risk of accident
  • Apps and Chatbots allowing customers to communicate with insurers directly
  • Drone solutions used by property insurers to inspect properties and their sites

Insurers are able to better evaluate risks, gather more data on their customers, and be more efficient by using better software. And, consumers, may benefit from cheaper prices enabled by savings insurers make by using better technology.

Strength in Numbers: Just How Many InsurTech Companies Are There?

There are between 1,100 and 3,475 companies that may be considered InsurTech listed on CrunchBase – a popular tech business information platform. For the purposes of this report, we included the companies specifically labelled as InsurTech, as well as companies working on the intersection of industries like software, IT, analytics, AI, and insurance.

So what does InsurTech look like as an industry? It’s a real mixture. Almost half of InsurTech (48%) are IT and Software companies, over one in ten (11%) are insurers venturing into tech, while 17% are either in AI or Data & Analytics.

Finally, 5% of InsurTech companies operate within Finance & Banking – an industry that goes hand-in-hand with insurance and risk management.

Two Decades of Growth: How InsurTech Carved Out Its Own Niche

By all accounts, InsurTech is an established industry with hundreds of companies in operation across the United States and the world. What do the numbers say about its growth potential? 

Legacy insurers who are now starting to invest in technology have been around for decades, but companies like Lemonade that harness the power of AI to drive benefits for their customers, or Next Insurance – a fully-online business insurance provider are relatively new to the market. 

Looking at the last twenty years, the growth has been relatively slow until mid 2010s, when in 2016, as many as 33% of all InsurTech companies in operation that year were brand new. 

The following year, 2017, saw a record number of 178 new InsurTech companies founded and in 2018 the industry hit a new milestone – 1,000 companies specifically identifying as InsurTech.

Follow The Money: How InsurTech Funding Went From Millions to Billions

At the outset, the amount of funding raised by companies in InsurTech was rather modest. Based on CrunchBase figures, the first purely InsurTech funding round was in 2007 when Guidewire Software, a software platform for insurers, raised $24 million.

Let’s just say that since then, the investment in both purely InsurTech and Software/IT/AI companies working with Insurance have skyrocketed, reaching a peak of $6.9 billion in 2020.


The amount of funding raised by companies in InsurTech and related industries was 8% higher than in 2019. Considering the effect the COVID-19 pandemic has had on the US economy, it’s a truly impressive figure.

What’s even more impressive is that the funding for InsurTech companies in the last decade was growing at an average of 89% every year.

Industry Leaders: InsurTech Companies With Highest Amounts of Funding

The company with the most VC funding raised to date is Suning Finance – a Chinese financial services company making inroads into InsurTech – with $1.8 billion. 

The next three entrants on the top list are all American tech-driven health insurance companies: Oscar Health with $1.6 billion in funding, Bright Health with $1.5b, and Clover Health – with $925 million.

In fact, 15 out of the top 20 companies by amount of funding raised are based in the United States. The exceptions are the above mentioned Suning Finance from China, PolicyBazaar and Digit Insurance from India, Premia Holdings from the UK and the German wefox. 

Building Confidence: Acquisitions Ramp Up in InsurTech

One sign of a maturing industry are acquisitions. As companies in InsurTech become better established and financially successful, they start acquiring smaller companies to boost their capability, improve their offering, or acquire new talent.

Last year may have brought about a certain downturn in investment and entrepreneurial activity in InsurTech, but one thing it didn’t slow down was acquisitions. As many as 81 InsurTech companies were acquired in 2020 – the highest number on record. 

Some of the most notable acquisitions last year included Brown & Brown buying up CoverHound – a platform for consumers to shop for car insurance for $111 million, and private equity firm Great Hill Partners paying $52 million for a digital platform for processing payments and claims called One Inc.

Even in the short time that’s elapsed in 2021, there have already been 14 acquisitions, among them a $50-million purchase of Bold Penguin by American Family Insurance.

Around the World: Where Are The World’s Biggest InsurTech Hubs?

As it is the case with many tech-related industries, the greatest share of InsurTech companies are based in the United States (1,370 or 44%). Following the U.S. are the usual suspects like the UK (313 companies), Germany (130), and Canada (122).

In a surprising 5th place is India (110), which has 16 more InsurTech companies than China (94). Another surprise entrant in the global top 10 is Israel. Known for its startup ecosystem and strong business connections with the U.S. and other developed nations, this small country on the Mediterranean is home to 64 InsurTech companies.

The city with the greatest number of InsurTech companies is also not in the United States, it’s London in the United Kingdom with as many as 197 InsurTech companies based in the British capital. New York City was in close second with 135, and San Francisco came third with 99 companies in the InsurTech space.

The rest of the top 10 is made up of world’s capitals and big cities including Paris (49), Berlin (47), Singapore (38), and Tokyo (33).

InsurTech Capitals of America: Where In The U.S. is InsurTech Scene Thriving?

Just like the United States tends to dominate startup industries in the world, California tends to dominate startup industries in the United States. Same with InsurTech – every one in five (21%) InsurTech companies in the U.S. is in California.

If we look at the density of InsurTech companies, i.e. the number of InsurTech companies per 10,000 companies listed on CrunchBase, a different picture emerges.

The states where the share of InsurTech companies is the highest are Kansas and Utah, where there are over 60 Insurtech companies for every 10,000 headquartered in these states, according to CrunchBase.

The two states rounding up the top five are Connecticut and New Jersey, both with around 50 InsurTech companies for every 10,000. Both states are known homes to large insurance and financial services companies such as Cygna in Connecticut and Prudential in New Jersey.

At city level, NYC (135) and San Francisco (99) are in the league of their own. Chicago, IL – the city with the third largest InsurTech scene has less than half the companies that San Francisco  – has 46.

Elsewhere, four cities had 20 companies: Austin, TX (29), Boston, MA (26), Atlanta, GA (25), and Seattle, WA (20). Palo Alto – a city in the heart of Silicon Valley had 18.

What Now & What’s Next? COVID Impacts And Thoughts On The Future?

Due to the pandemic, the pace of InsurTech growth has somewhat slowed in 2020. Companies in the industry secured 27% less funding than the year before and only 59 InsurTech companies were founded, compared to 658 that entered the industry in 2019.

This trend is echoed in the CapGemini InsurTech 2020 report, where 90% of InsurTech companies reported being fully able to conduct business remotely, yet feeling the COVID-19 impact on their new customer acquisition and retention.

Being remote increases the reliance on technology both for consumers and for companies in the insurance and InsurTech space. Despite significant progress in the last decade, there’s still a long way to go.

Even in 2018, at the height of InsurTech growth, the greatest risk facing insurance companies according to the special PWC report was modernization. Just last year, the top concern for insurance agents in a survey from 2020 – competition from online insurance providers. 

As usage of advanced technologies (APIs, cloud-based systems) remains low, there will always be room for more InsurTech solutions and companies to provide them. The year 2020 may have been a bump in the road, but as consumers and companies are learning to live under new circumstances, the industry growth is likely to return.

Methodology and Sources

All data on InsurTech companies, such as their locations, industries, year of incorporation, acquisitions, the amount of venture capital funding raised by year was taken from CrunchBase. Data was collected and is accurate as of January 2020.

Companies were deemed InsurTech if their industry designation on CrunchBase was listed as “InsurTech” or a combination of “Insurance” and “Software”, “Information Technology”, “Internet Services”.

In addition, the following materials have been used in preparation of this report:

  1. Capgemini – World InsurTech Report 2020 Press-release
  2. PWC – InsurTech Innovation
  3. PropertyCasualty360 – 2020 Agent Survey: Insurance agents and InsurTech

Research by VK

Photo by Markus Spiske on Unsplash