Insurtech market set to grow $77b by 2028

However, the high cost of investment remains a key challenge for the industry.

The global insurtech market is projected to grow by $77.41b from 2024 to 2028, expanding at a compound annual growth rate (CAGR) of over 42.35%, according to Technavio. 

This rapid growth is driven by the need to improve business efficiency, with increased collaboration between investors and insurtech firms. 

However, the high cost of investment remains a key challenge for the industry.

Artificial intelligence (AI) and machine learning are transforming insurance by enabling personalised solutions, improving risk assessment, and streamlining operations, the report said.

Real-time tracking through IoT devices and data analytics is enhancing risk monitoring and claims management, whilst cloud computing and blockchain are increasing transparency and efficiency.

The shift to digital insurance has heightened the role of customer data, with predictive models offering insights into purchase behaviour and customer needs, according to Technavio. 

Big data and chatbots are improving customer interaction, while insurers leverage AI to provide personalised recommendations and decisions.

Investors’ interest in insurtech is evident from recent industry events, where discussions centred on the integration of technology to simplify claims processing, reduce fraud, and enhance customer experiences. 

However, there are challenges such as the need for retraining staff to handle new systems effectively and integrating these solutions with existing services.