In spite of ongoing macroeconomic and geopolitical uncertainties, deals in Southeast Asia’s insurtech sector witnessed a significant increase, reaching $2.35b from 27 deals in 2023. According to the sources, Singlife’s merger with Aviva Singapore, valued at $2 billion, played a critical role in driving the trend. However, early-stage startups witnessed decreased funding, with only two Series A deals totalling $2.3 million.
EY mentioned in their report that “investors are becoming more selective, focusing on profitable companies with innovative technologies or regional presence,” which can be seen in the number of deals made in different regions of Southeast Asia. Singapore maintained its leadership in insurTech funding and deal count, representing 85% of the total deal value. However, Indonesia, Thailand, and Malaysia are gaining traction as investment destinations, driven by favourable demographics and evolving market conditions.
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Further, EY Partner Rahul Vardhan mentioned, “Presence across multiple jurisdictions will also be a key differentiator to allow scale in SEA’s underpenetrated insurance market. However, regional expansion is a capital-intensive endeavour that requires a strong understanding of local regulations to navigate the regulatory hurdles smoothly.”
The same report also mentioned the rise in exit strategies in the Insurtech sector, which included IPOs, Secondary transactions, and more. According to the report, in 2023, there were a total of three M&As, one IPO, and two secondary transactions.
