Insurtech funding rebounds, mega-deals return

The growth was fueled by a significant uptick in funding for property and casualty (P&C) insurtechs, which attracted $2.76 billion, a 46.2% jump from 2024. Health-related insurtech funding also saw a substantial increase, rising 21.8% to $1.39 billion. Notably, late-stage funding rounds are making a comeback, signaling increased investor confidence in more mature insurtech businesses. Several "megadeals"—funding rounds of $100 million or more—drove the overall surge. This funding landscape suggests a shift towards insurtechs focused on tangible solutions for improving underwriting, claims processing, and customer engagement, aligning with the operational efficiency demands of carriers and agencies. The focus appears to be on practical AI applications and automation that streamline existing workflows rather than disruptive, unproven technologies.