Gallagher Re: AI InsurTechs Secure $897m in Q3 Funding Boom
Global insurtech funding reached US$1.38bn in the third quarter of 2024, with companies focused on AI securing US$897.4m across 29 deals, according to a report from reinsurance broker Gallagher Re. This marks the highest level of funding since the first quarter of 2023.
Eight of the 10 largest funding rounds went to AI-centred companies, resulting in an average deal size of US$34.9m for AI-focused ventures. The dominance of AI in the sector is underscored by the fact that 63.4% of all deals were centred around artificial intelligence technology.
Shift in funding patterns
The quarter saw five ‘mega-rounds’ – individual investments exceeding US$100m – which accounted for 55.5% of total funding. This represents a change from recent quarters which had shown fewer large individual investments. The surge in mega-rounds indicates continued institutional support for technological innovation in the insurance sector.
The total number of deals fell to 77, the lowest figure in nearly four years. However, the average deal size increased from US$18.46m in Q2 to US$20.9m in Q3, driven by the mega-rounds. This marks the first time since Q3 2022 that average deal sizes have exceeded the US$20m threshold.
Segment performance
The life and health insurance technology sector saw funding increase by 56.4% quarter-on-quarter to US$657m. Property and casualty insurtech funding – covering home, motor and business insurance – decreased by 15.4% to US$722.16m.
Companies focused on central business operations – those developing back-office systems and processes – secured 81.4% of total funding across 42 deals, indicating a focus on core insurance infrastructure rather than consumer-facing technology. This concentration of investment suggests a strategic shift towards improving fundamental insurance operations.
“The third quarter of 2024 has not only seen a resurgence in insurtech funding but also a shift towards a more even distribution of capital, reflecting a maturing and stabilising industry,” says Andrew Johnston, Global Head of InsurTech at Gallagher Re.
Mid-stage funding rounds – typically series B and C – received the majority of investment from insurance and reinsurance companies, suggesting a focus on scaling existing technology rather than backing early-stage ventures. This trend points to a maturing market where investors are prioritising proven technologies over early-stage experimentation.
AI investment focus
The report forms part of Gallagher Re’s 2024 series examining artificial intelligence in insurance, covering distribution, risk assessment, business operations and claims handling. The comprehensive analysis includes case studies from established insurtech firms and emerging players in the sector.
The document features insights from several technology providers in the insurance sector. These include ProNavigator – an AI assistant for insurance queries, Solstice – a claims automation platform, Appian – a low-code automation platform, and ELEMENT – a digital insurance platform provider.
- Total funding: $1.38bn
- AI-focused funding: $897.4m
- Number of deals: 77
- Average deal size: $20.9m
- Mega-rounds (>$100m): 5
The analysis extends to partnership developments between insurance software provider Insurity and financial services technology company Coherent. It also examines significant deals involving Gradient AI – an underwriting automation company, Cowbell – a cyber insurance provider, and Akur8 – an insurance pricing platform.
The report includes perspectives from industry executives James Wright of specialty insurer Beazley and James Whitelaw of reinsurance firm Trans Re, alongside columns from Denise Garth of insurance software provider Majesco and Gallagher Re’s Gina Butterworth.
“Through this year's focus on AI, our intention has been to help businesses understand AI's core principles, various subfields, and the advantages of effective implementation, ultimately enabling them to enhance operational efficiency, improve risk management and drive innovation in the insurance industry,” Andrew says.
Make sure you check out the latest industry news and insights at InsurTech and also sign up to our global conference series - FinTech LIVE 2024 and InsurTech LIVE 2025
InsurTech is a BizClik brand
