A new wave of insurance innovation is coming: emerging risks.
To better understand this category, we’ve been tracking investments in startups leveraging technology in this market. This includes data providers, algorithm builders, and software solutions, even if they are not (yet) selling to insurance companies.
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Our primary focus has been on the French market, where we’ve managed to get an exhaustive view of fundraising rounds thanks to Avolta Partners’ weekly newsletter.
From this data, we've built a quarterly barometer focusing on tech startups addressing emerging risks. Categories were defined by keeping rounds announced when they resonate with challenges insurers are increasingly highlighting.
So far, this has led to nine categories, including obvious ones: sustainability (which also covers climate risks), digital health, and cybersecurity. And beyond we are tracking: InsurTech, Electric Vehicles, Digital Assets, AI risks, Future of work and Financial risks.
Over the quarter, the three largest rounds in that space were announced by the following startups: Alan and Akur8 both in InsurTech ; Odaseva in CyberSecurity.
We are really excited about that growing space, as we believe this is where startups and incumbents could benefit from teaming up. There’s indeed a need for spotting and accessing new data sets, as historical data is lacking. To make sense of this data, algorithms need to be built, ultimately unlocking insurance capacity based on this risk understanding. Startups are more relevant for the initial data and algorithm development stages, while incumbents remain the go-to players for leveraging these insights to provide insurance solutions.
