According to the Italian Insurtech Summit Report published by the Italian Insurtech Association (IIA) in collaboration with the Fintech and Insurtech Observatory of the Politecnico di Milano, the capital invested in insurtech in Italy by insurance companies between January 2020 and June 2021 was € 110 million, considering startup investments, startup partnerships and internal innovation projects: € 50 million throughout 2020 and additional € 60 million in H1 2021.
Peanuts compared to € 2.8 billion invested in the UK, € 2.5 billion in Germany and € 2.2 billion in France.
Unfortunately, data shows substantial inactivity of insurance companies in Italy in the first six months of 2021: 58% of them did not make any investments into startups, and the remaining 42% of them did not increase their efforts compared to 2020. However, according to IIA, the outlook for 2021 is more positive than the previous year (the 2021 forecast is € 100/120 million of capital invested).
In Italy, insurance companies are open to collaboration, but they still prefer to develop most tech solutions internally, recurring only marginally to startup investments. In H1 2021, only 22% of insurance companies have made at least one investment (it was 19% in 2020), while 66% of them have started at least one internal innovation project (it was 63% in 2020). It must however be said that approx. 80% of insurance companies have made at least one partnership with a startup or an innovation player in H1 2021 (it was 75% in 2020).
Worsening the Italian situation are the inadequate digital skills of insurance companies. Only 34% of the surveyed companies by IIA considered their proprietary technological assets adequate to meet the challenges of the evolving industry, compared to 66% of the European average. Moreover, only 34% of insurance companies have a team dedicated to innovation (77% the European average) and only 25% of them have a digital unit with a specific budget and employees (85% the European average). 71% of people working in the Italian insurance industry believe that there is a technical and digital gap in their competencies that limits the ability to develop new products and services in line with the needs of an increasingly digital consumer.
According to the survey conducted by IIA and Yolo and published in May 2021, the digital consumer is expected to grow exponentially in the coming years (today the digital consumer represents 32%; within 10 years, 82% of people interested in insurance products will be digital).
For this reason, IIA hopes to increase insurtech investments in Italy from € 50 million in 2020 to € 1 billion in 2023, a goal that can be only achieved with the cooperation of insurance companies towards a bigger, more integrated, younger and more dynamic market.
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The reports (in Italian) are available at the following links: Italian Insurtech Summit Report, Survey IIA and Yolo