Investment Trends in the Latin American Insurtech Sector
The ninth edition of the LatAm Insurtech Journey report, created by Digital Insurance LATAM and sponsored by the Madrid-based insurer MAPFRE, highlights significant trends in the region’s insurtech ecosystem. According to the report, annual investment in this sector fell by 38% compared to 2023, amounting to only $92 million. However, the latter half of the year witnessed a promising 156% increase over the first half, indicating an optimistic outlook for 2025.
Growth and Development of Insurtech Startups
Despite the dip in annual venture capital investment, the Latin American insurtech landscape continues to thrive, closing 2024 with over 500 insurtechs. This reflects a growth rate of 5% for the year and an average of 12% since 2021. The report shows that 29% of these startups are foreign, while international expansion is growing by 23%. The rate of internationalisation stands at 15.9%, with Chile leading at 32% and Peru at 50%, driven by their scalability needs.
Focus on Digital Distribution and Enablement
A breakdown of the insurtech ecosystem reveals that 51% of these startups focus on digital distribution, whereas 49% function as enablers, collaborating with re/insurers and intermediaries. Hugues Bertín, CEO of Digital Insurance LatAm & President of the Pan-American Insurtech Alliance (AIP), stated, “This has been a year of resilience and learning. A strong correlation is observed between the growth in the number of insurtechs in a country, their internationalisation, and the presence of solid and collaborative insurtech partnerships with the traditional sector.”
Future Outlook and Strategic Insights
Both internationalisation and attraction indices continue to grow, marking the trends where insurtechs with solid value propositions expand swiftly, and multinationals view Latin America as a consolidated market. Carlos Cendra, Scouting & Investment Lead at MAPFRE Open Innovation, commented, “The increase in funding during the second half of 2024, alongside the ongoing rise in the number of startups, underscores the ecosystem’s robustness and the region’s conviction in the insurance industry’s potential.”
As we step into 2025, new financing rounds have been announced, including those of Sami and Olé Life. This hints at a positive trend in the coming year, although global venture capital conditions and their potential impacts on Latin America should be closely monitored.
