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.