The Indian InsurTech landscape has made significant strides, with 150+ InsurTechs and a 12x increase in revenue over the past five years to reach $750m and a cumulative valuation of $13.6bn, says Boston Consulting Group (BCG).
This picture is presented in a report titled “India InsurTech Landscape and Trends: Pathways to Inclusive Insurance— A Vision for 2047”, published by BCG in collaboration with the India InsurTech Association (IIA),
Funding
In 2023, in line with global trends, India’s InsurTech market saw a funding slowdown. Total funding stood at $300m in 2023, down from $500m in 2022 and the peak of $580m in 2021, the report shows.
Some observations in the report about Indian InsurTech funding are:
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Multiline InsurTechs received the majority (85%) of the funding in 2023.
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The number of deals has remained largely consistent, with 11 deals in 2023 compared to nine in 2022 and 14 in 2021.
Opportunities
The report says that as India progresses towards “Viksit Bharat” 2047” (‘Developed India’), there is significant opportunity for the industry to drive insurance for all. It points out that the bulk – 85% – of InsurTech revenue in 2023 was generated by only nine out of the 150+ InsurTech entities.
The report also says that there are opportunities for InsurTechs in niche solutions leveraging data and technology (e.g. face scan for medical underwriting, health score basis behaviour).
However, penetration continues to remain a challenge, especially in health insurance with over 45% spends being out of pocket. There lies substantial opportunity for InsurTechs to boost health insurance penetration across three pathways:
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Driving higher accessibility through new channels and improving efficiencies in existing channels.
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Driving higher awareness and trust through focus on overall health, wellness and a seamless experience.
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Driving higher affordability by leveraging data and introducing innovative products.
Strategic priorities
Asked in a survey to name their key strategic priorities, more than half of the respondents cited profitability, geographical expansion, exploring new partnerships and product innovation. The survey respondents numbered more than 25.