Clyde & Co's recently released its annual Insurance Growth Report. As discussed in the report, while mergers and acquisitions in 2016 were down from the prior year, deal activity is expected to be strong in 2017. More interestingly, perhaps, is that future growth in the insurance industry is going to focus on investments in insurance technology.
According to the report, 94% of insurers expect digital transformation to have the greatest impact on their distribution channels in the next five years. With this strength of consensus, it is not surprising that insurtech startups worldwide attracted approximately USD 1.7 billion of investments in 2016.
Insurance companies have been operating in difficult market conditions for several years; with intense competition, pressure on premium rates and prolonged low interest rates, growth has been hard to achieve. Technology will offer a quantum leap in growth by reducing insurers' cost base and at the same time enhancing their productivity and leading to the development of new insurance products and businesses.
Insurtech is a topic that is certain to remain on insurance companies' strategic agendas for the near to medium term. We at Clyde & Co are working on exciting insurtech projects and tracking the legal regulatory developments that will affect the insurtech space in the long run.
To read Clyde & Co's Insurance Growth Report and other insights on the global insurance marketplace, click here.