Investment in InsurTech in the UK has surged to record levels, according to Accenture analysis of CB Insights data.
Accenture noted that this is a “sign of confidence in the UK as a global hub for insurance technology”.
The figures showed that investment in UK InsurTech has increased to ￡218m in the first half of 2017, compared to ￡7.3m the year before.
According to Accenture, the UK’s decision to leave the European Union has not impacted the amount of investment coming into the InsurTech sector, and it highlighted that London remains the “undisputed centre for European InsurTech investment” with 30% of all deals taking place in the city.
The research further revealed that cloud computing, the Internet of Things and big data technologies attracted the most investment.
Deal activity in the UK accelerated in 2017, with the number of deals having jumped by 75% from the same point last year.
Simon Tottman, head of insurance research for the UK and Ireland at Accenture, told Insurance Age that the uptick in innovation and digitisation in the industry has had an impact on the broker market.
“The key message for us is that 2017 is an enormous year for InsurTech in the UK,” Tottman said.
He added: “Brokers have to reinvent themselves and diversify beyond their core broking and transactional activities. This has been born out of technological innovation.”
According to Tottman technology has allowed insurers to deal directly with customers in a better and more efficient way than before.
“This is what InsurTech start-ups focus on,” he added. “They make customer engagement better and the products more personalised and people increasingly see fewer reasons for going through a broker, particularly in personal lines.”
However, he highlighted that there are opportunities for brokers to harness big data and enhance their services.
Tottman further noted that brokers needed to diversify and collaborate more with InsurTech start-ups to remain relevant.
“Brokers could have a great role to play in acting as the glue between insurers and start-ups,” he commented. “Insurers are working with lots of partners and they need help forming collaborations.”
Tottman concluded: “For brokers it’s a mixture of both challenges and opportunities. They have to partner with start-ups to create an ecosystem that insurers need to be a part of.”