Key US InsurTech investment stats in Q1 2026:
- US InsurTech deal activity increased by 6% YoY in Q1
- Californian and New York companies each secured 25% of all deals to share the lead in the US InsurTech market for the quarter
- Shepherd, an AI-native commercial insurance platform focused on construction and infrastructure projects, raised $42m in a Series B round, marking one of the biggest US InsurTech deals of the quarter
US InsurTech deal activity increased by 6% YoY in Q1
US InsurTech recorded 32 deals in Q1 2026, down 6% from 36 deals in Q4 2025 and 6% from 34 deals in Q1 2025.
Funding came in at $484.7m, up 22% from $396m in Q1 2025 but down 42% from $834.2m in Q4 2025.
The year-on-year rise in funding against a slight dip in deal volume suggests that average deal sizes have grown compared with a year ago, though the sharp sequential decline in capital raised points to the Q4 2025 figure being driven by a small number of larger transactions that did not repeat in the following quarter.
Californian and New York companies each secured 25% of all deals to share the lead in the US InsurTech market for the quarter
California and New York retained their positions as the two most active InsurTech states in Q1 2026, each recording eight deals and a 25% share of total activity.
Both markets saw their deal volumes fall from Q1 2025, when California led with 13 deals and a 38% share and New York followed with 11 deals and a 32% share, declines of 38% and 27% respectively.
Despite the drop in absolute terms, the contraction in their combined share from 71% to 50% reflects a broader distribution of activity across the country rather than a loss of relative standing in isolation.
Texas climbed from two deals and a 6% share in Q1 2025 to four deals and a 13% share in Q1 2026, doubling its volume and meaningfully strengthening its position as the third most active state.
The narrowing gap between Texas and the two leading states points to a gradual dispersal of US InsurTech deal flow, even as California and New York remain the clear centres of the market.
Shepherd, an AI-native commercial insurance platform focused on construction and infrastructure projects, raised $42m in a Series B round, marking one of the biggest US InsurTech deals of the quarter
The round was led by Intact Private Capital, which also serves as a carrier partner providing expanded capacity, with participation from Spark Capital, Costanoa Ventures and additional investors, bringing total funding to $67m.
The company has grown revenue more than 7x over the past 24 months, now insuring over $400bn in project value across more than 1,500 policies for 600 clients, including leading AI labs, chip manufacturers and hyperscalers constructing the physical infrastructure behind the AI economy.
Its platform integrates real-time data from construction technology partners including Procore, Autodesk, OpenSpace and DroneDeploy directly into underwriting, reducing feedback times from weeks to hours and enabling behaviour-based pricing through its Shepherd Savings programme, which rewards contractors who invest in safety and operational excellence.
Proceeds will support platform and product expansion, including a growing renewable energy vertical, as the company works towards fully autonomous underwriting where AI handles intake, data enrichment, risk analysis and pricing end to end.
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