In the last two years of the corona pandemic, the number of start-ups in the insurtech market has declined, and some start-ups have had to file for bankruptcy. Now the scene has largely recovered from the corona pandemic; a start-up mentality can be observed. In addition, more and more insurers are entering the market.
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2021 was a year of recovery in the Insurtech market: after the Corona crisis, a start-up mentality can now be observed again. The relevance of the insurtech scene will continue to increase in 2022. “The topic of sustainability will come more and more into focus and we will hear more about successful unicorns and maybe even decacorns,” says Felix Sandt, Head of Network at New Players Network.
The New Players Network, an initiative of Versicherungsforen Leipzig, has published the updated version of its overview of the insurtech scene. The new edition presents 195 start-ups in the DACH region, 31 of which are new business models that are driving the insurance industry and its development with innovative solutions.
The founder mentality is back
In the last two years of the corona pandemic, the number of start-ups has decreased, and some start-ups have had to file for bankruptcy. The start-up scene has now largely recovered from the corona pandemic and a start-up mentality can be observed.
“In addition to a new focus of business models on health and health protection, the crisis brought about a digitization boom. Characteristics such as simplicity, knowledge transfer and accessibility are now the focus. This offers great potential for future InsurTechs,” says Sandt.
According to the study, the number of unicorns, i.e. start-ups with a market valuation of over one billion US dollars, is growing rapidly. With Clark and Wefox, two unicorns have been cavorting on the insurtech market in the DACH region since the end of 2021. According to the study, Wefox developed into a unicorn as early as 2019 and is now one of the multi-unicorns.
Sustainability offers potential for InsurTechs
Across all sectors, companies are concerned with the topic of sustainability. Customers are attaching more and more importance to sustainable products and the demand for sustainable products and services is increasing. In the insurance industry, the topic of sustainability has long been about more than just green-labelled products and sustainable capital investments. “Especially for InsurTechs there is the potential to create a competitive advantage through sustainable orientation. The earlier the adjustment takes place here, the better prepared the start-ups are for the future,” says Theresa Löwe, Head of Transformation at the New Players Network.
Insurers are taking back the market
The trend around start-ups and insurtechs has now also reached the established players in the industry. Large insurance companies are increasingly opening up the market by founding subsidiaries or investing in new business models. The offers of the start-ups are interesting or even necessary for the core business of the insurers. “Whereas foreign investors in particular used to support German insurtechs, German insurers have also become active in recent years and have secured a part of the market with various investments,” says Löwe. Large companies are increasingly looking for external innovation impulses in order to ensure their own future viability, Löwe continues.
The current overview of the New Players Network also gives an overview of new approaches and developments by now 195 start-ups from German-speaking countries. The cluster contains information about the company, its foundation and the investors involved. The business models presented are fundamentally divided into insurtechs, which deal with the core areas of the insurance value chain, and start-ups, which support the insurance process with their business model.
The overview divides the start-ups into 17 categories. In addition, the market behavior towards established providers was again evaluated. The overview also contains assessments by the experts of the New Players Network on how developments in the industry should be assessed.
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