AI-focused start-ups have taken a record 95.2% of global InsurTech venture funding, claiming all 10 of the quarter's biggest deals and pushing the sector into its strongest back-to-back stretch in nearly four years, Gallagher Re said in its latest Global InsurTech Report.
Total funding reached $1.63 billion in the first quarter of 2026, easing from $1.67 billion in the previous quarter. The two quarters together mark the sector's best showing since Q3 2022, breaking a long run of quarterly totals stuck near the $1 billion mark.
The rebound caps a punishing downcycle for InsurTech. Annual funding peaked at $15.8 billion in 2021, then collapsed to $7.10 billion in 2022, $4.50 billion in 2023, and a low of $4.25 billion in 2024, Gallagher Re's earlier reports show.
Full-year 2025 funding rose 19.5% to $5.08 billion, the first annual gain since the boom.
Cumulative global InsurTech investment crossed $60 billion in mid-2025, with roughly a quarter of that going to AI-focused firms, the broker said in an earlier update. Re/insurers themselves played a growing role, completing a record 162 InsurTech deals last year.
AI-focused companies pulled in $1.55 billion across 68 deals in Q1 2026, at an average deal size of $25.79 million. The 95.2% share is a sharp jump from 77.9% in Q4 2025, when the average AI deal stood at $22.14 million, prior Gallagher Re data shows.
Early-stage funding climbed 36.1% quarter-on-quarter to $548.50 million, also the highest since Q3 2022. The average early-stage deal rose 278.8% year-on-year to $14.06 million.
Life & Health InsurTech funding nearly doubled to $718.99 million, lifted by several large transactions. Property & Casualty funding moved the other way, falling 31% to $907.14 million, though the average P&C deal held at $20.2 million.
Andrew Johnston (pictured above), global head of InsurTech at Gallagher Re, said the past two quarters had "bucked the now three-year trend of quarterly funding of around US$1 billion."
The AI funding share, he argued, showed how committed the industry now was to the technology. "AI and InsurTech are now almost synonymous," he said.
InsurTechs working on digital and cyber risk have raised $5.77 billion across 263 deals since 2012. In the first quarter alone, AI liability and cyber insurance firms drew $444.84 million.
Gallagher Re's Q1 2026 edition opens the final leg of its three-year AI series, this time focused on AI liability insurance and its overlap with cyber.
The cover is designed to protect businesses from losses tied to AI systems, with the sharpest exposures in healthcare, finance, and autonomous vehicles.
Freddie Scarratt, the broker's global deputy head of InsurTech, said third-party AI liability cover was on track to mirror the rise of the cyber reinsurance market. "The silent risk of AI is becoming audible, and ignoring it is no longer an option," he said.
