The data: Quarterly equity funding for insurtechs has settled at $1.0 billion in Q3, a 17% drop from Q3 2024 according to CB Insights. Funding has plateaued in the $1B–$1.4 billion range since early 2023—far below the $5.3 billion peak in Q4 2021.
Investors have grown more selective, focusing on B2B insurtechs that offer a faster path to profitability than their consumer-facing counterparts. Deals in Q3 included SAFE Security (cyber risk insurance underwriting), ServiceUp (vehicle insurance claims management), and Upstage (insurance operations).
What happens next: With funding constrained, more insurtechs are looking for exits. Twenty-one were acquired in Q3—the most since Q3 2022—and one went public. Those include:
- Zurich Insurance Group bought cyberinsurance and threat detection platform BOXX to expand its retail and small business cyber offerings.
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Accelerant, a platform that connects specialty MGA and investors, went public this summer and is now valued at $3.4 billion.
- Hiscox, a business insurer, agreed to acquire Vouch Insurance Company (a broker) and Corix (its MGA) from Vouch, Inc.
- Munich Re agreed to acquire the remaining 71% of NEXT Insurance, a small business insurtech, at a valuation of $2.6 billion.
Our take: The quiet winners in insurtech are now B2B, focusing on supporting other players with underwriting, claims management, and operations infrastructure. Unlike Lemonade, Root, and Hippo, which are still working toward consistent profitability, these firms are reshaping the industry from the back end rather than trying to disrupt it head-on.
With valuations depressed, legacy insurers are well positioned to modernize by acquiring new technology and niche product lines, rather than building in-house.