The Insurtech industry has
thrived over the past decade as the increasing use of mobile devices and the
need for quick, simple and safe insurance solutions has increased. Similarly,
commercial insurance continues to embrace ways to increase the speed and accuracy
of underwriting process and claims functions. Insurance technology is driving
this transformation but not every Insurtech is a roaring success.

In 2020 Insurtech funding
reached its lowest point since early 2018 but in Q2 the investment market bounced
back with signs the market was comfortable with further long-term investment in
technology firms. In Q3, 2020 the amount of global funding surged into
Insurtechs (both U.S dollar amounts and transaction volume). Q4 saw funding
reach an all-time high across both Property & Casualty (P&C) and Life
and Health (L&H). Hippo, Unqork, Waterdrop, Oscar Health, Bind Benefits and
Newfront Insurance all receiving $100M “mega-round” funding whilst Series B and
Series C deals also experienced an uptick.

Those Insurtechs that get the
formula right all fill significant needs in the market i.e allow consumers to
find insurance coverage incredibly quickly from a broad range of risks, or
conveniently shop for the lowest insurance rates. A smoother claims process also
rates highly.

The majority that don’t go on
to receive larger funding deals often cite the following reasons for Insurtech
failures…

• Timing
  – Being either too early or to late to market and not meeting a consumer
  or commercial need that is not strong.

• Not
  Getting Funding Early Enough – Delays in funding can impact on a company’s
  ability to find resources and stability needed for further growth.

• People
  /Lack Of Specialist Staff – Startups don’t always have the market presence
  to attract the experts or best minds in the market. The essential skills
  needed to make the company successful. Technology alone will not provide a
  competitive advantage.

Talent is as important as
technology in keeping pace. No amount of tech investment will equip a business
to compete with a workforce that doesn’t have the required digital and creative
problem solving skills. Equally for Founders and early Senior Management, a
lack of resources and difficulties articulating future skills are one of the
biggest hurdles.

Hanover has a successful
track record of partnering with the Insurtech industry to identify key
technical talent, senior functional staff and leadership for Pre-Seed/Seed,
Series A, B, C Insurtechs. With 2021 being the most important year yet, Hanover
is providing innovative ways to partner with the startup community by identify
and attracting the best talent at such crucial milestones of a company’s growth
and expansion.