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UK insurtech bucks the global trend, attracting $1bn of investment in 2018

UK insurtech bucks the global trend

According to KPMG’s latest Pulse of Fintech Report, UK insurtechs saw over $1bn of investment activity through 2018, up from $792m in 2017.

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According to KPMG’s latest Pulse of Fintech Report, UK insurtechs saw over $1bn of investment activity through 2018, up from $792m in 2017.

UK based insurtechs bucked the global trend, as despite thirteen $100m+ insurtech deals taking place globally, overall investment levels declined year-on-year by almost half, standing at $5.7bn for 2018.

UK Insurtech Investment

Simon Ranger, Head of Insurance, KPMG UK comments: “Claims management and the unbundling of services and processes were magnets for investment through 2018, and I expect that to continue. Exciting technologies like AI and Machine Learning are going to redefine insurance, but it will be almost impossible to see their full potential until firms have dealt with the basics - their data and legacy systems - and that for most, is still a work in progress.

“Clearly, the UK has a thriving insurtech sector. We are seeing the market mature as fewer, but bigger, deals take place. In line with overall fintech investment activity, insurtech was fuelled by the first half of the year with investment nosediving in H2. Between July and December 2018, just $63m of investment activity took place, versus $406m during the same period in 2017. Whether this is a trend that will continue remains to be seen.”

Will Pritchett, Head of Insurtech, KPMG Global, adds: “Whilst globally there has been a sharp drop in insurtech investment since 2017; $6 billion is still easily the third-highest annual total ever.

“Looking to the year ahead, Asia is poised to see substantial growth in insurtech investment, in part driven by US and Europe-based traditional insurers looking to use Asia to test alternative insurance offerings. Compared to the US and Europe, Asia is seen to have relatively low barriers to entry, a high population base and fairly light regulations — making it highly conducive for testing innovative options. The UK is positioning itself well as our government and regulators continue to build fintech bridges with Asia, to help reduce regulatory barriers and support growth in a post-Brexit world.”

                                                            ENDS

See more data on global insurtech investment activity on page 20 of the report: The Pulse of Fintech 2018 [2 mb]

For more information, contact:
Christina Bridge
KPMG UK
07789504905
Christina.Bridge@kpmg.co.uk

Ed Fotheringham Smith
KPMG UK
07920 572490
Edward.fotheringhamsmith@kpmg.co.uk

About KPMG Fintech

The Financial Services industry is transforming with the emergence of innovative new products, channels and business models. This wave of change is driven by evolving customer expectations, digitalization, as well as continued regulatory and cost pressures. We are passionate about supporting clients to successfully navigate this transformation, mitigating the threats and capitalizing on the opportunities. KPMG Global Fintech comprises professionals in over 45 fintech hubs around the world, working closely with financial institutions and fintech companies, to help them understand the signals of change, identify the growth opportunities and to develop and execute on their strategic plans.

About KPMG International

KPMG is a global network of professional services firms providing Audit, Tax and Advisory services. We operate in 154 countries and territories and have 200,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

About KPMG UK

KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 16,300 partners and staff. The UK firm recorded a revenue of £2.338 billion in the year ended 30 September 2018. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. It operates in 154 countries and has 200,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

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