A report published by Allied Market Research has detailed that the InsurTech market is expected to garner $158.99bn globally by 2030.
The global InsurTech market was set at a $9.41bn value last year and is estimated to generate $158.99bn by 2030, growing at a compound annual growth rate of 32.7% from 2021 to 2030.
The report found that the rise in digitalisation of business models, saturation of the insurance industry and the growth and consolidation of internet technologies has fuelled the growth of the global InsurTech market.
However, issues around privacy and transparency as well as legal and regulatory framework changes have hindered market growth in other areas.
Allied discovered that instead of being a roadblock for the industry, Covid-19 positively impacted the InsurTech market due to the sudden need for insurance policies including health insurance, home insurance and personal insurance among customers.
The use of advanced technological solutions among insurance carriers grew across the world during the pandemic to provide tech-based services to customers, something which increased the demand for InsurTech solutions overall.
The report highlighted that the InsurTech service segment would register the highest CAGR of 33.6% between 2021-2030, as the sector is able to process and improve effectiveness to match customer demand.
The service segment was found to hold the largest market share in 2020 and accounted for over three-fourths of the global InsurTech market due to the climb in implementation of solutions by insurance firms with capabilities to enhance business operations.
Allied detailed that measured by deployment model, the on-premise segment of InsurTech dominated the market in terms of revenue over last year, and contributed almost three-fifths of the global InsurTech market. However, the cloud aspect of the market is projected to register the highest CAGR over the nine-year period at 34.5%, due to the fact there is a need to reduce infrastructure investment and raise investment in cloud technology.
In terms of regional market share, the North American InsurTech held the largest share during 2020, contributing to almost three-fifths of market. This was due to increased adoption of InsurTech among insurance companies as well as a surge in partnership of InsurTech firms with traditional insurers.
However, during the period of 2021-2030, Allied underlined that Asia Pacific is expected to portray the highest CAGR of 36.7%, which is attributed to the increase in adoption and investment in InsurTech to bolster business efficiency, lower compliance risk exposure and improved claim settlement processes in the region.
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