Global funding of insurance start-ups surged to $US1.31 billion ($2.04 billion) in January-March, up 90% on the previous quarter, Gallagher Re says.

There were 97 deals, up from 78 in October-December.

Property and casualty start-ups made up $US1.13 billion ($1.76 billion) of the funding, while early-stage funding fell to a near five-year low.

Gallagher Re global head of insurtech Andrew Johnston says the year “got off to a fascinating start, with many commentators talking about an ‘insurtech spring’ amid a flurry of notable deal activity. There are significant deals happening across the industry.”

Munich Re’s March acquisition of Next Insurance – which values the US digital insurer at $US2.6 billion ($4.05 billion) – has “certainly caught the attention of the industry”, he says. In Australia, Upcover completed an $11 million equity round.

Acquisitions are up, artificial intelligence funding is significant, and last year brought a record high for reinsurers investing in insurance start-ups, Mr Johnston says.

“The future of insurtech is certainly looking brighter than it was 24 months ago. We anticipate that we are now entering an era of sustainability.

“Perhaps we are in more than an ‘insurtech spring’ and in fact at the foothills of a longer-standing trend of sustainable adoption of technology into our industry.”

See the report here.