Global insurtech funding reached its highest quarterly level in four years during the second quarter of 2026, driven almost entirely by investment into artificial intelligence-focused companies, according to the latest Gallagher Re Global Insurtech Report.
Insurtech funding totalled $2.44 billion in Q2 2026, the strongest quarterly result since Q2 2022. However, the increase was largely driven by several large funding rounds, with investment becoming increasingly concentrated among AI-focused companies.
AI-focused businesses accounted for 99.1% of total funding, attracting $2.42 billion during the quarter. All funding rounds above $5 million went to AI-focused companies, highlighting continued investor interest in AI applications across insurance.
AI infrastructure creates new insurance opportunities
The latest Gallagher Re report focuses on the infrastructure supporting AI adoption, particularly the rapid expansion of data centres that power advanced computing workloads.
Data centres are becoming a critical part of the digital economy, but the speed of development and complexity of AI hardware are creating new challenges for insurers assessing these risks.
Gallagher Re said the growth of AI infrastructure presents both challenges and opportunities for the (re)insurance sector, as underwriters develop approaches for this emerging class of business.
Early-stage funding declines
Despite strong overall funding levels, early-stage investment declined during the quarter.
Early-stage funding fell 51.8% quarter over quarter, from $548 million in Q1 2026 to $264.19 million in Q2 2026. The market still recorded 54 early-stage deals, suggesting continued activity among younger companies despite lower funding volumes.
The results indicate that investors are increasingly prioritising companies with established AI capabilities and commercial traction.
Insurers maintain technology investment activity
Insurance and reinsurance companies completed 27 technology investments in Q2 2026, down from 32 in Q1 2026.
Early-stage companies accounted for 51.9% of insurer-backed investments, showing continued interest in emerging technology despite a more selective investment environment.
Gallagher Re said the quarter reflects a market where AI is absorbing a growing share of capital, while the broader innovation pipeline, particularly for solutions targeting incumbent insurers, may be narrowing.
