Artificial Intelligence & Internet of Things Attract Almost Half of InsurTech Funding Globally in 2016, According to Accentur...
March 30 2017 - 2:15AM
Business Wire
Number of deals and investment funding in AI
and IoT show strong year-on-year growth
Insurtech investment in U.K. jumps more than
50% in 2016, to nearly US$19 million
Artificial intelligence (AI) and the internet of things (IoT)
now account for almost half of total investment in insurance
technology (insurtech) startups globally, new research from
Accenture (NYSE:ACN) shows.
The research, which includes new analysis of CB Insights data on
450 insurtech deals over the last three years, appears in a new
Accenture report titled “The Rise of InsurTech.” The report was
released today in conjunction with Accenture’s Fintech Innovation
Lab in London, which for the first time includes a dedicated
insurtech stream comprising leading industry startups.
According to the report, the combined number of deals across AI
(including automation) and the IoT (including connected insurance)
increased 79 percent in 2016. Even though the two technologies
represented only one-quarter (24 percent) of the 216 insurtech
deals globally last year, they accounted for 44 percent or US$711
million of total insurtech investment — compared with just 10
percent of global insurtech investment in 2015.
“We’ve seen a rapid acceleration of investment into and deal
activity around intelligent automation and IoT start-ups over the
last 12 months,” said Roy Jubraj, a co-author of the report and
Accenture’s Digital & Innovation lead in the company’s
Financial Services practice in the U.K. and Ireland. “These
technologies are primed to disrupt the industry in the years to
come, so it’s fitting that we’ve established a dedicated insurtech
stream as a key part of Accenture’s FinTech Innovation Lab in
London.”
According to the report, the insurance industry views AI and the
IoT as critical to delivering increased levels of personalization
and better real-world outcomes for customers. Artificial
intelligence has the potential to transform the insurance industry
from simply assessing risk based on past experience to monitoring
risks in real-time and mitigating, or even preventing, losses for
customers. The IoT will enable insurers to offer more-personalized,
real-time service; boost operational efficiency; and price their
products with greater precision.
Despite the political and economic uncertainty around the United
Kingdom’s vote to leave the European Union, the country continued
to attract strong insurtech investment in 2016. Even though the
number of insurtech deals in the U.K. remained flat, the value of
the investments there more than doubled last year, to almost
US$19 million. Investment in AI and the IoT also increased
significantly, to almost US$1.7 million in total.
Germany and France also saw strong growth in investment in 2016
to round out the top three insurtech markets in Europe. With
insurtech’s investment expanding globally, the United States’ share
of deal volume in 2016 dropped slightly, from 63 to 56 percent of
total deals. The percentage of insurtech investment for the rest of
the world (deals outside the traditional hubs) more than doubled,
from 11 percent in 2015 to 23 percent in 2016.
Insurtech’s shifting geographic focus maps closely to similar
global trends across fintech. Recent Accenture fintech analysis
showed that China, and more broadly, Asia Pacific, are playing a
more prominent role as investment destinations for fintech capital.
While global investment into fintech ventures grew 10 percent in
2016, to US$23.2 billion, Asia Pacific as a region for the first
time eclipsed North America, with fintech investments there more
than doubling in 2016, to US$11.2 billion.
Julian Skan, a senior managing director in Accenture’s Financial
Services practice who oversees the FinTech Innovation Lab London,
said, “The rise in insurtech is further evidence of the growing
role that new technologies are playing in shaping innovation across
financial services. The next challenge for insurtech startups is
the same as what the more mature fintechs are now facing – being
able to translate that investment into growth and customer
acquisition.”
Accenture FinTech Innovation Lab London
Accenture’s FinTech Innovation Lab in London kicked off the
largest program in its five-year history in January, with 20
innovative startups selected from a global field of more than 300
financial services technology entrepreneurs. Eight of the 20
shortlisted startups presented at the program’s Graduation Day
today in London to a group of venture capitalists and
financial-industry executives. For more information, click
here.
The FinTech Innovation Lab London is modeled on a similar
program co-founded in 2010 by Accenture and the Partnership Fund
for New York City, the US$150 million investment arm of the
Partnership for New York City. In 2014 Accenture launched two other
FinTech Innovation Labs, in Hong Kong and Dublin. Globally, the
Labs’ alumni companies have raised more than US$480 million in
venture financing after participating in the program, and the 36
companies that participated in the London FinTech Innovation Lab
have increased their revenues by 170 percent, on average, since
completing the program.
About Accenture
Accenture is a leading global professional services company,
providing a broad range of services and solutions in strategy,
consulting, digital, technology and operations. Combining unmatched
experience and specialized skills across more than 40 industries
and all business functions – underpinned by the world’s largest
delivery network – Accenture works at the intersection of business
and technology to help clients improve their performance and create
sustainable value for their stakeholders. With approximately
401,000 people serving clients in more than 120 countries,
Accenture drives innovation to improve the way the world works and
lives. Visit us at www.accenture.com.
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AccentureNatalie De Freitas, + 44 27 84
48469natalie.de.freitas@accenture.comorJames Murphy,
917-452-0588james.p.murphy@accenture.com
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