Insurtech Market Size, Share, Growth and Forecast, 2025-2035

Cloud cores and claims AI drive insurer software spending

The insurtech market was valued at USD 17.54 billion in 2025 and is projected to increase from USD 20.23 billion in 2026 to USD 73.23 billion by 2035, registering a CAGR of 15.36% during 2025–2035. Three forces sustain demand, as carriers replace decades-old policy, billing and claims systems with subscription cloud cores, AI cuts the cost of handling claims, and embedded sales require quote-and-bind tools for retailers, lenders and travel firms. North America held the largest regional share, 46.0% in 2025, supported by the biggest property and casualty market and the deepest MGA sector, while Asia Pacific grows fastest at 19.19% a year. The main commercial change is the move from AI features to AI agents that complete underwriting intake and first notice of loss, while supervisors from the NAIC to EIOPA now expect documented governance for every pricing and claims model.

Where insurer technology budgets go and what stays outside the count

Insurers buy technology through multi-year contracts that mix subscription, license, transaction and implementation fees. A core replacement covers policy, billing and claims for a whole book and runs a decade or more, while analytics, claims AI and distribution tools are often bought line by line. As contracts move to cloud subscriptions, vendor revenue grows faster than insurer budgets because the fee recurs every year.

The count includes five solution families sold to carriers, reinsurers, MGAs and brokers. It excludes premiums written by digital-native carriers such as Lemonade and Root, commissions earned by online aggregators, cyber cover sold to technology firms, generic IT services, hardware, in-house development and stand-alone customer portals. The narrow definition keeps premium growth from inflating a technology total.

Core platforms anchor budgets as embedded tools grow fastest

Policy administration cores lead by solution as embedded distribution platforms grow fastest

Based on solution, the market is categorized into core platforms and policy administration, underwriting, pricing and risk analytics, claims management and fraud AI, distribution and embedded insurance platforms, and telematics and usage-based insurance. Core platforms led with 30.0% of 2025 value, because replacement contracts run for a decade or more and anchor every other purchase. Distribution and embedded insurance platforms grow fastest at 18.20% a year, as MGAs, brokers and non-insurance partners buy quote, bind and servicing tools.

Auto carriers spend most by insurance line while commercial and specialty writers grow fastest

Based on insurance line, the market is categorized into auto, commercial and specialty, home and property, life and annuities, health and travel and others. Auto led with 29.0% of 2025 value, combining the largest personal-lines claims volumes with telematics and photo-estimating spend. Commercial and specialty grows fastest at 16.86% a year, because AI can now read, score and route broker submissions within minutes.

Cloud cores, cheaper claims and checkout sales drive demand

Decades-old policy and billing systems push carriers onto subscription cloud cores

Most large carriers still run at least one policy or billing system written decades ago, and replacing it is a multi-year program that leaves the vendor with recurring subscription fees. Guidewire, the largest independent property and casualty core vendor, says more than 570 insurers in 44 countries use its products, according to its fiscal 2026 results release. Core platforms held 30.0% of 2025 value, and the replacement cycle in North America and Europe runs well past 2030.

AI cuts the share of premium spent on handling claims

Claims handling absorbs a large slice of every premium dollar, so AI now reads first notice of loss, separates simple claims from complex ones, writes estimates from photos and flags fraud. Lemonade's second-quarter 2026 letter, filed with the U.S. Securities and Exchange Commission, reports a record-low 5% loss adjustment expense ratio, down from 13% in the third quarter of 2022, against an industry average of about 9%. U.S. and European incumbents buy claims software to close that gap within five years.

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Checkout and partner sales require quote-and-bind software

Insurance is increasingly sold at the point of another purchase, such as a car, flight, phone, lease or small-business loan. Each partner needs an API to quote and bind, a way to settle commissions and a data feed back to the carrier, and MGAs writing specialty business buy the same tools. Distribution and embedded insurance platforms are the fastest-growing solution at 18.20% a year. Latin America grows at 16.79% a year as retailers and digital banks in Brazil and Mexico sell cover at checkout.

Investor capital concentrates on vendors that sell AI to carriers

Investors still fund the space but have grown selective, and Gallagher Re reported in August 2026 that total insurtech funding in the second quarter of 2026 was the highest since the second quarter of 2022, with 99.1% going to AI-focused companies, while early-stage funding fell 51.8% quarter on quarter. Capital now flows to vendors that sell underwriting and claims AI to carriers rather than to start-up carriers, which widens the supply of tools incumbents can buy through 2028.

AI agents and private equity reshape insurer vendors

AI agents increasingly take over underwriting intake and first notice of loss

Vendors are shifting from AI features to agents that finish whole tasks. Duck Creek Technologies launched an insurance-native agentic AI platform on April 28, 2026, with an underwriting workbench that takes a submission from intake to quote and an agentic first notice of loss tool for claims, while Guidewire markets Guidewire AI and ProNavigator. Credence Research expects pricing per task or per claim to become a standard line in vendor contracts by 2028, which raises revenue per policy for vendors that prove accuracy.

Private equity owners and acquisitions consolidate core and claims vendors

Advent International completed its acquisition of Sapiens on Dec. 17, 2025, taking private a vendor with more than 600 customers in more than 30 countries, and Duck Creek Technologies is owned by Vista Equity Partners. CCC Intelligent Solutions completed its acquisition of EvolutionIQ in January 2025, adding AI guidance for disability and injury claims to an auto platform. Private ownership funds long cloud migrations without quarterly pressure and makes bolt-on purchases of small AI firms more common.

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AI that reads commercial submissions opens an opportunity

Commercial and specialty submissions still arrive as emails, PDFs and spreadsheets that underwriters rekey by hand. Tools that extract, score and route them are the clearest near-term opening, which is why commercial and specialty grows fastest among lines at 16.86% a year, with MGAs and specialty carriers in the United States and the London market buying first. Vendors that pair extraction with rating engines and audit trails can win multi-year platform deals.

First-time core buyers in Asia Pacific and life insurers offer an opportunity

Pre-configured cloud cores and low-code product builders cut a migration from years to months for regional mutuals and mid-sized carriers. The largest untapped demand sits in Asia Pacific, which held 20.0% of 2025 value and is the fastest-growing region, as many insurers retire in-house systems. Life and annuity carriers are a second opening, because their books are long and their systems older. Replacement of life insurance policy administration systems gives vendors a runway that extends beyond 2035.

Failed migrations, AI supervision and thin data teams

Core replacements run late and freeze other purchases

A core system touches every policy, bill and claim, and data from decades-old systems is messy, product rules are buried in code and testing takes years, so programs often slip. When a migration runs late, carriers pause new spending until it lands, which stretches vendor sales cycles and delays revenue from add-on analytics. Vendors reduce the risk with pre-built product content, phased cut-overs by line of business and fixed-scope cloud packages that let mid-sized carriers go live in under 12 months.

AI supervision adds documentation cost to pricing and claims models

The EU AI Act, Regulation 2024/1689 of June 13, 2024, treats AI used for risk assessment and pricing in life and health insurance as high-risk. In the United States, the NAIC adopted its AI model bulletin in December 2023, and 29 jurisdictions had adopted it by Oct. 8, 2026, according to the NAIC adoption map. Vendors must document data, testing and human oversight, which favors larger suppliers whose built-in model inventories turn the cost into a selling point.

A narrower funding pipeline leaves niche tools without scale

Gallagher Re noted that insurers and reinsurers backed 27 technology investments in the second quarter of 2026, down from 32 in the first quarter, and warned of a possible narrowing of the innovation pipeline. When capital crowds into a few AI names, capable tools in pricing or distribution struggle to reach scale, which limits choice for carriers. Partnerships and app marketplace listings with core vendors give smaller firms a cheaper route to market.

Scarce data engineers limit what mid-sized carriers can run

Actuaries, underwriters and claims handlers need retraining, and data engineers are scarce outside the largest groups. Mid-sized carriers in Latin America and the Middle East and Africa often lack staff to manage several vendors at once, so projects stall after the first module goes live, which favors suite vendors over point specialists. Managed cloud services, vendor-run model monitoring and pre-trained claims AI reduce in-house staffing needs.

U.S. carriers lead as Asia Pacific buys first packaged cores

North America's property and casualty market is the deepest and funds every solution family

North America held 46.0% of 2025 value and grows at 13.59% a year. The United States has the largest property and casualty market, the deepest MGA sector and the headquarters of most large core, claims and agency-software vendors. Adoption of the NAIC AI model bulletin by 29 jurisdictions shapes how pricing and claims models are sold. Growth trails the 15.36% market average because many large carriers have already completed a first cloud migration.

Europe's AI governance rules steer carriers toward compliant vendors

Europe held 26.0% of 2025 value and grows at 14.19% a year. Germany, France and the United Kingdom are the largest buyers. The EIOPA Opinion on AI governance and risk management, published in August 2025, and the EU AI Act add compliance work for pricing and claims models, but they also push carriers toward vendors with built-in governance. Shift Technology sells fraud detection and claims automation across the region, and Sapiens serves life and property carriers.

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Asia Pacific grows fastest on first packaged cores and digital distribution

Asia Pacific held 20.0% of 2025 value and is the fastest-growing region at 19.19% a year. China has the most developed online insurance sector, India has a fast-growing digital distribution base, and Japan and Australia are replacing older cores. Many carriers there are buying packaged cores and quote-and-bind tools for the first time, which lifts vendor revenue per contract, while local vendors compete on price and language support.

Latin America and the Middle East and Africa grow through embedded sales and mobile microinsurance

Latin America held 4.5% of 2025 value and grows at 16.79% a year, led by embedded sales in Brazil and Mexico. The Middle East and Africa held 3.5% of 2025 value and grows at 17.79% a year. Gulf carriers are digitizing motor and health lines, while mobile-led microinsurance spreads across Africa.

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Agentic platforms, a Sapiens buyout and AI rules, 2025–2026

Agentic workflows, cloud cores and explainable models

• Agentic AI takes a submission from intake to quote, or a claim from first notice to settlement, and shifts pricing from seats to tasks completed.
• Cloud-native cores built as multi-tenant policy, billing and claims platforms shorten migrations and deliver updates without upgrade projects.
• Connected-car and home data grows as telematics moves from smartphone apps to connected cars and home sensors flag water leaks and fire risk early.
• Model governance through inventories, bias testing and explanation tools answers the EU AI Act, the NAIC bulletin and EIOPA expectations inside the vendor platform.

Core suites, claims specialists and agency software houses

Suite vendors Guidewire, Duck Creek Technologies and Sapiens sell policy, billing and claims cores under long contracts, while Majesco and EIS compete for mid-sized carriers with cloud-native platforms. Claims and data specialists, including CCC Intelligent Solutions, Verisk and Shift Technology, sell the analytics around the core. Distribution and telematics firms such as Applied Systems, Vertafore, Insurity and Cambridge Mobile Telematics connect carriers to agents, MGAs and drivers. Credence Research estimates that the 10 largest vendors hold a little over half of global value. Core platforms are concentrated because few carriers switch once a core is live, while analytics, claims AI and distribution are fragmented across hundreds of regional and early-stage firms. Buyouts raise concentration, and new AI entrants pull the other way.

Core, claims, data and distribution vendors profiled

Insurtech has become a software subscription business

Credence Research's view is that insurtech is now about software subscriptions sold to incumbents, not start-up carriers. The largest new revenue sits in claims AI, embedded distribution and agentic underwriting. Vendors that combine a core, proven AI agents and built-in governance are best positioned, and the main risk is a slowdown in core migrations. Buyers and investors should watch agent pricing, private equity deals and AI rules in the EU and U.S. states.

Insurer IT budgets checked against vendor disclosures

The report uses 2025 as the base year and forecasts to 2035, with CAGR calculated over 2025–2035. Market values come from Credence Research's model of insurer technology budgets, checked against vendor-disclosed insurance revenue, company filings and NAIC and EIOPA publications; segment and regional splits are Credence Research estimates.

Per-task AI pricing and cloud subscriptions set the pace

Through 2035, insurer spending will tilt from one-time projects toward recurring subscriptions and per-task fees for AI agents. Claims and underwriting automation will become standard in auto, the largest line at 29.0% of 2025 value, and in home and commercial lines, while life carriers start their own core replacements. Asia Pacific will gain share as insurers buy first packaged platforms, while North America, growing 13.59% a year, remains the largest buyer.

Note: The depth of individual sections depends on data availability for this market. Volume, capacity, trade and other unit-based metrics are included where applicable.