Demand for Insurtech in USA

Demand for Insurtech in USA 2025 to 2035

The USA insurtech demand is valued at USD 9.3 billion in 2025 and is estimated to reach USD 84.9 billion by 2035, recording a CAGR of 24.8%. Demand is driven by rapid digitalisation across insurance distribution, underwriting, and claims management. Insurtech platforms support automation of policy issuance, data-driven risk assessment, telehealth-linked servicing, and customer onboarding across digital-first channels. Growth is reinforced by increasing adoption of AI-enabled analytics, remote identity verification, and cloud-based policy administration systems designed to improve efficiency and reduce operational costs for insurers.

Health insurance represents the leading insurance type due to strong growth in digital enrolment, remote benefits management, and demand for continuous risk monitoring. Digital platforms in this segment provide structured workflows for claims processing, eligibility checks, and documentation verification. Integration of health data sources, remote diagnostics, and predictive analytics continues to influence product design and service delivery.

Quick Stats for USA Insurtech Demand

• USA Insurtech Sales Value (2025): USD 9.3 billion
• USA Insurtech Forecast Value (2035): USD 84.9 billion
• USA Insurtech Forecast CAGR (2025 to 2035): 24.8%
• Leading Insurance Type in USA Insurtech Demand: Health Insurance
• Key Growth Regions in USA Insurtech Demand: West, South, Northeast
• Top Players in USA Insurtech Demand: Entrust, Onfido, IDEMIA, Transmit Security, Secret Double Octopus

Demand is strongest in the West, South, and Northeast, where large insurers, technology providers, and employer networks drive digital adoption. Key suppliers include Entrust, Onfido, IDEMIA, Transmit Security, and Secret Double Octopus. Their focus is on secure identity frameworks, workflow automation, and integration capabilities that support digital underwriting and claims-processing functions.

What is the Growth Forecast for Insurtech Industry in USA through 2035?

The 10-year growth comparison shows a pronounced shift from rapid early expansion to more structured, platform-driven maturity. Between 2025 and 2030, growth will be strongest as insurers adopt digital underwriting tools, automated claims systems, and data-driven risk models. Early gains will be reinforced by increased use of API-based distribution, embedded insurance within digital commerce platforms, and broader integration of telematics, behavioral analytics, and remote-inspection technologies across property, health, and auto segments.

From 2030 to 2035, growth remains high but becomes more predictable as large carriers standardize digital workflows and insurtech platforms mature. Expansion during this period is driven by lifecycle upgrades, regulatory alignment for digital policies, and widespread use of AI-supported risk scoring. While the pace moderates compared with the early years, adoption deepens across complex lines such as commercial, specialty, and cyber coverage. The decade-long comparison shows a transition from innovation-led acceleration to sustained enterprise-scale modernization, supported by operational efficiency needs, improved data infrastructure, and long-term digital-transformation strategies in the USA insurance industry.

Insurtech Industry in USA Key Takeaways

Metric	Value
USA Insurtech Sales Value (2025)	USD 9.3 billion
USA Insurtech Forecast Value (2035)	USD 84.9 billion
USA Insurtech Forecast CAGR (2025 to 2035)	24.8%

Why is the Demand for Insurtech in the USA Growing?

Demand for insurtech in the USA is expanding as insurers and consumers seek faster, digital and more personalised insurance services. Technology platforms for underwriting, claims automation, usage-based insurance, data-driven risk assessment and real-time customer engagement support increased efficiency and consumer convenience. Rising consumer expectations, competition from tech-savvy entrants and increased mobile adoption drive insurers to invest in innovative solutions.

Growth is further supported by regulatory encouragement of digital innovation, increased data availability and open-API ecosystems that enable partnership models between traditional insurers and technology firms. Constraints to growth include regulatory complexity across states, legacy system integration challenges within incumbent insurers and concerns over data privacy and cybersecurity risk. Smaller insurers may lack resources to adopt advanced technologies which may slow industry penetration.

Which Insurance Type, End-User, and Technology Segments Lead Demand for Insurtech in the USA?

Demand for insurtech solutions in the United States is shaped by digital transformation priorities across insurers, intermediaries, and technology providers. Distribution across insurance type, end users, and technology categories reflects adoption of digital onboarding, automation, analytics-driven underwriting, and platform-based customer interaction. These patterns illustrate how insurers and service partners deploy technology to reduce processing errors, streamline claims, and expand digital service delivery.

By Insurance Type, Health Insurance Accounts for the Largest Share of Demand

Health insurance holds 35.5% and represents the leading category. Adoption of digital claims processing, automated eligibility checks, virtual health integrations, and mobile-first policy management supports this share. Life insurance represents 21.5%, reflecting increased use of automated underwriting and identity verification tools. Auto insurance accounts for 17.0%, linked to telematics-driven pricing, digital claims imaging, and automated appraisal workflows. Property and casualty insurance holds 14.0%, supported by digital policy management and risk-assessment tools. Commercial insurance represents 12.0%, reflecting gradual integration of digital platforms for underwriting and claims handling in business-focused portfolios.

Key drivers and attributes:

• Health insurers rely on automation for claim cycles and member services.
• Life insurance uses data-driven underwriting tools.
• Auto insurers apply telematics for pricing and claims accuracy.
• P&C and commercial lines adopt tools for operational efficiency.

By End User, Insurance Companies Account for the Largest Share of Demand

Insurance companies hold 39.7% of USA insurtech demand, reflecting strong investment in digital platforms that improve risk assessment, claims processing, and customer engagement. Internal modernisation strategies drive adoption of AI systems, low-code platforms, and automated decision engines. Brokers and agents represent 25.1%, using digital quoting, CRM tools, and automated comparison systems to support client acquisition. Third-party administrators account for 18.2%, supported by workflow automation, digital claims handling, and document-management tools. Aggregators and comparison platforms hold 17.0%, relying on API-based integrations to deliver real-time quotes and policy comparisons.

Key drivers and attributes:

• Insurers prioritise digital transformation for internal operations.
• Brokers rely on digital tools for quoting and customer management.
• TPAs use automation to reduce administrative workloads.
• Aggregators depend on real-time data flows and integration capability.

By Technology, Artificial Intelligence Accounts for the Largest Share of Demand

Artificial intelligence holds an estimated 32.0% share. AI supports predictive modelling, customer verification, claims automation, and fraud detection across insurance segments. Machine learning and data analytics account for 27.0%, reflecting widespread use of risk scoring and premium modelling. Cloud computing holds 21.0%, enabling hosted underwriting systems, API-based integration, and scalable claims platforms. Internet of Things (IoT) represents 12.0%, used in telematics, property sensors, and workplace safety monitoring. Blockchain and smart contracts hold 8.0%, serving niche applications in policy validation and secure data exchange. Technology distribution reflects the varying maturity of digital infrastructure across insurers.

Key drivers and attributes:

• AI supports automated decision-making and fraud detection.
• Data analytics improves underwriting accuracy.
• Cloud platforms enable scalable digital operations.
• IoT devices supply real-time behavioural or risk data.

What are the Drivers, Restraints, and Key Trends of the Demand for Insurtech in the USA?

Increased digitalisation of insurance operations, rising consumer expectations for seamless experiences, and need for cost efficiency are driving demand.

In the United States, demand for insurtech solutions is growing as insurers seek to modernise legacy systems, accelerate digital transformation and respond to changing consumer behaviours. Customers expect fast, user-friendly interactions for quotes, claims, policy adjustments and renewals, which drives deployment of digital platforms, mobile apps, AI chatbots and embedded insurance interfaces. Insurers also face pressure to reduce operational costs, improve underwriting accuracy and enhance risk selection. Insurtech companies providing data analytics, telematics, IoT-driven risk monitoring and automation of claims processing are gaining traction across personal lines, commercial insurance and niche segments. The growth of digital distribution models and direct-to-consumer insurers further supports insurtech adoption.

Regulatory complexity, legacy ecosystem inertia and cybersecurity risks restrain adoption.

Insurance regulation in the USA varies by state, which complicates deployment of new technologies and requires significant compliance investment. Many insurers operate on outdated IT infrastructure and deeply embedded process models, which slows the ability to integrate insurtech solutions or replace legacy systems. The handling of large volumes of personal and risk data introduces cybersecurity and data-privacy obligations, which raise cost and may deter small providers from rapid adoption. Uncertainty about ROI from investments in new platforms also makes some incumbents cautious.

Rise of embedded insurance models, increased use of AI and analytics across underwriting and claims, and expanding partnerships between insurers and tech firms define industry trends.

Insurtech adoption in the USA is shifting toward embedded insurance offerings where coverage is integrated into platforms outside traditional insurance channels, such as mobility services, e-commerce check-out flows and connected devices. AI and predictive analytics are being used to improve risk-scoring, personalise coverage and accelerate claims settlement, improving customer satisfaction. Major insurers increasingly form partnerships with insurtech firms and startups to pilot new business models, reduce time-to- industry and harness agile innovation. These trends are positioning insurtech as a key growth driver in the evolving U.S. insurance landscape.

Analysis of the Demand for Insurtech in the United States by Region

Demand for insurtech in the United States is expanding rapidly through 2035 as insurers, brokers, and digital-service providers adopt technology-driven solutions for underwriting, claims handling, customer onboarding, and risk analytics. Growth is reinforced by rising operational automation, increased use of API-driven platforms, and broader integration of artificial intelligence across policy management systems. Insurtech applications support digital policy distribution, fraud detection, telematics-based pricing, and automated claims verification. Regional differences reflect technology-sector concentration, startup activity, insurance-carrier density, and digital-adoption levels within commercial and personal insurance industries. The West leads with a 28.5% CAGR, followed by the South (25.5%), the Northeast (22.8%), and the Midwest (19.8%).

Region	CAGR (2025-2035)
West	28.5%
South	25.5%
Northeast	22.8%
Midwest	19.8%

How is the West driving demand for insurtech?

The West grows at 28.5% CAGR, supported by strong technology-sector activity, extensive startup ecosystems, and broad adoption of digital insurance platforms across personal and commercial industries. California, Washington, and Colorado host insurtech firms developing automated underwriting systems, AI-based claims tools, and digital distribution platforms. Regional carriers integrate telematics, remote-verification tools, and risk-scoring algorithms to enhance accuracy in pricing and fraud detection. Venture-capital activity supports continuous development of cloud-native insurance software and embedded-insurance technologies. High demand from technology companies, gig-economy platforms, and online marketplaces reinforces sustained adoption of digital insurance tools.

• Strong concentration of insurtech startups and digital-platform providers
• Broad adoption of automated underwriting and AI-driven claims tools
• High use of telematics and digital-risk-scoring systems
• Continuous development supported by active venture-capital networks

How is the South advancing demand for insurtech?

The South grows at 25.5% CAGR, supported by strong insurance-carrier presence, expanding fintech clusters, and broad adoption of digital underwriting and claims platforms. Texas, Florida, Georgia, and North Carolina maintain large insurance operations that integrate automation, customer-self-service platforms, and predictive-risk analytics. Carriers rely on digital distribution tools for sales, policy servicing, and compliance workflows. Growing metropolitan populations increase demand for automated policy onboarding, particularly in property, auto, and health segments. Regional fintech ecosystems continue to adopt API-based insurance connectors that streamline policy sales across digital marketplaces.

• High adoption of automated underwriting across major carriers
• Broad usage of customer-self-service and digital-claims solutions
• Strong integration of risk-analytics tools in property and auto segments
• Steady growth supported by expanding fintech and insurance hubs

How is the Northeast shaping demand for insurtech?

The Northeast grows at 22.8% CAGR, supported by dense financial hubs, established insurance groups, and strong adoption of compliance-driven digital tools. States such as New York, Massachusetts, New Jersey, and Pennsylvania rely on insurtech systems for regulatory documentation, real-time risk assessment, identity verification, and digital customer support. Carriers integrate advanced analytics for policy pricing and automated workflow software to manage claims and underwriting tasks. Consulting firms in the region use insurtech platforms to support actuarial analysis and insurance-process optimization. High commercial-insurance activity reinforces consistent demand for digital modernization across large enterprise clients.

• Strong usage across major insurers and financial institutions
• High adoption of analytics-driven pricing and risk-assessment tools
• Increased reliance on automated claims-management systems
• Stable demand from commercial-insurance and enterprise clients

How is the Midwest influencing demand for insurtech?

The Midwest grows at 19.8% CAGR, supported by regional insurance carriers, established financial-services networks, and increasing digital transformation across corporate environments. States such as Illinois, Ohio, Michigan, and Wisconsin adopt insurtech platforms for customer onboarding, fraud detection, policy-servicing automation, and agent-workflow management. Regional insurers integrate AI-supported claims systems and telematics-based pricing models. Midwestern financial institutions rely on digital-compliance tools and automated verification modules to manage regulatory requirements. Growth remains steady due to modernization initiatives across traditional insurance industries and rising demand for digital capabilities.

• Broad use of automated servicing tools across regional carriers
• Strong adoption of telematics and AI-based claims software
• Increased integration of digital-compliance and verification tools
• Reliable growth driven by modernization of traditional insurance networks

What is the competitive landscape of the demand for insurtech solutions in the USA?

Demand for insurtech solutions in the USA is shaped by a concentrated group of digital-identity and authentication providers that support underwriting, claims automation, policy onboarding, and fraud-mitigation processes. Entrust holds the leading position with an estimated 30.3% share, supported by established credential-management systems, strong cryptographic infrastructure, and long-term integration with insurers requiring high-assurance identity validation. Its position is reinforced by consistent performance across digital policy issuance, secure document handling, and multi-factor authentication frameworks.

Onfido and IDEMIA follow as major participants, supplying identity-proofing, biometric verification, and document-analysis tools widely used in digital onboarding and claim-authorization workflows. Their strengths include scalable machine-learning models, verified document-authenticity checks, and alignment with fraud-control requirements for U.S. insurers. Transmit Security maintains a notable presence through passwordless authentication and orchestration platforms designed to streamline customer sign-in, reduce friction, and improve retention during digital policy interactions.

Secret Double Octopus contributes additional capability through enterprise-grade multi-factor and credential-resilience solutions that support insurers seeking to reduce identity-related fraud and strengthen access control across distributed teams. Competition across this segment centers on fraud-detection accuracy, biometric reliability, integration flexibility, regulatory alignment, and consistency of customer-verification performance. Demand is expanding as insurers continue to digitize policy issuance and claims management, adopt automated identity controls, and invest in secure, low-friction authentication and verification systems that improve operational efficiency and reduce exposure to identity-driven losses.

Key Players in USA Insurtech Demand

• Entrust
• Onfido
• IDEMIA
• Transmit Security
• Secret Double Octopus

Scope of the Report

Items	Values
Quantitative Units	USD billion
Insurance Type	Health Insurance, Life Insurance, Auto Insurance, Property & Casualty Insurance, Commercial Insurance
End User	Insurance Companies, Brokers & Agents, Third-Party Administrators, Aggregators & Comparison Platforms
Technology	Artificial Intelligence, Machine Learning & Data Analytics, Blockchain & Smart Contracts, Internet of Things, Cloud Computing
Regions Covered	West, Midwest, South, Northeast
Key Companies Profiled	Entrust, Onfido, IDEMIA, Transmit Security, Secret Double Octopus
Additional Attributes	Dollar sales by insurance type, end user, and technology categories; regional adoption trends across West, Midwest, South, and Northeast; competitive landscape of insurtech solution providers; advancements in underwriting automation, digital claims processing, behavioral analytics, IoT-enabled risk monitoring, and blockchain-based policy administration; integration with insurers, brokers, TPAs, and comparison platforms in the USA.

USA Insurtech Demand by Segments

Insurance Type:

• Health Insurance
• Life Insurance
• Auto Insurance
• Property & Casualty Insurance
• Commercial Insurance

End User:

• Insurance Companies
• Brokers & Agents
• Third-Party Administrators
• Aggregators & Comparison Platforms

Technology:

• Artificial Intelligence
• Machine Learning & Data Analytics
• Blockchain & Smart Contracts
• Internet of Things
• Cloud Computing

Region:

• West
• South
• Northeast
• Midwest