Global insurtech funding reached US$2.44bn in Q2 2026, the highest quarterly total in four years, driven by a resurgence in large funding rounds and continued investor appetite for AI-focused companies, according to Gallagher Re’s latest Global InsurTech Report.
The quarter saw US$1.67bn raised through funding rounds of US$100m or more, accounting for 68.4% of total investment and marking the strongest quarter for mega-round fundraising since Q4 2021, the broker said.
Quarterly deal activity also strengthened, with 107 transactions completed during the period, matching the highest level since Q1 2024.
AI-labelled insurtech firms continued to dominate investment activity, accounting for 99.1% of the total funding raised during the quarter.
According to the report, AI-focused companies secured US$2.42bn across 95 deals in Q2 2026, up from US$1.55bn across 68 deals in the previous quarter. Every funding round above US$5m went to an AI-focused company, demonstrating the growing convergence between AI and insurtech, Gallagher Re said.
Gallagher Re said much of the quarter’s growth was driven by large venture capital and private equity-backed funding rounds rather than capital from (re)insurers. (Re)insurance companies participated in 27 technology investments during the quarter.
Andrew Johnston, Global Head of InsurTech at Gallagher Re, said, “Capital availability is clearly not a problem. And yet we are seeing something of a paradox: at a time when AI is supposed to be making things cheaper, individual insurtechs seem to be raising, then burning through, more cash than ever.”
He added, “The strongest AI-focused insurtechs will either help incumbent (re)insurers deploy AI safely and measurably across insurance workflows or use AI to attack parts of the insurance value chain that incumbents are too slow to transform.”
More funding but fewer bets
Despite the sharp rebound in funding volumes, the number of companies attracting meaningful investment continued to narrow.
Early-stage insurtech funding fell 51.8% to a four-quarter low, despite deal activity remaining relatively strong. Average deal size declined 50.6% quarter-on-quarter from a recent high of US$14.06m in Q1 2026.
Life and health insurtech companies completed 41 funding deals during the quarter, the highest since Q3 2022. Property and casualty insurtech deal activity also increased, rising from 55 transactions in Q1 2026 to 66 in Q2 2026.
Alongside funding trends, the report highlighted the rapid expansion of the infrastructure underpinning the AI economy, particularly data centres, as a growing opportunity for the (re)insurance industry.
“The AI boom is creating one of the largest new pools of insurable assets the industry has seen in decades,” Johnston said. “Every major data centre being built today will require insurance during construction and throughout a multi-decade operational life. The opportunity is enormous, but success will depend on understanding how risks move between traditional classes of business.”
The growing demand for data centre protection has already prompted insurers and brokers to expand specialist offerings for the sector, as operators face increasingly complex operational, cyber and catastrophe risks.
Companies including Lockton, Marsh, FM, and Aon have launched or enhanced dedicated data centre insurance capabilities this year.
The expansion of data centre capacity also aligns with broader investment in digital infrastructure and supply-chain diversification across Asia-Pacific. The region currently accounts for about 30% of global data centre capacity, while hyperscale data centre projects across APAC and other markets are expected to generate around US$10bn in new insurance premiums in 2026.
