Insurtech 2021: Reset vs. Resume

2020 was a year like no other, so it should come as no surprise that we aren’t just going to be able to pick up where we left off as the pandemic eases. That is even truer with regard to the high-risk, high-reward world of investing in insurtechs.

To use a football metaphor, 2020 was a year full of ‘broken plays.’ Now that conditions are beginning to settle, we need to look at 2021 as a ‘rebuilding’ year; more of a reset than a resumption of what was.

Crunchbase data shows that there were almost 60 insurtech funding rounds in the final quarter of 2020, lower than the 65 transactions in the same period in 2019 but much higher than the paltry 36 transactions in the second quarter of 2020.

Equally revealing is that almost half of the rounds in the last quarter of 2020 were for $10 million or more, reinforcing a longer-term trend toward fewer startups receiving higher amounts in a confusing and uncertain business environment.