Life and Non-Life Insurance Market in Israel - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

The market is segmented by Insurance type (Life Insurance and Non-Life Insurance) and by distribution channel (Direct, Agents, Online, and Other Distribution Channels)

Market Snapshot

Study Period: 2016 - 2026
Base Year: 2020
CAGR: <5 %

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Market Overview

  • Life and non-life insurance market in Israel is estimated to record a CAGR of approximately 5% during the forecast period.
  • Insurtech is growing rapidly in the country, the regulator issued a circular to insurers under which it will ease the regulations on capital demands for any investments in insurtech companies which will allow them to operate digitally and make the distribution of insurance products more efficient. In 2019, Israeli-founded insurance tech startup Sproutt raised a USD 12 million Series A round in funding led by Israeli early-stage venture capital firm State of Mind Ventures (SMOV). The increase of the Israeli InsurTech sector is supported by advanced big data capabilities, small market size, receptivity for early adoption, cybersecurity expertise, and a strong blockchain community.
  • Israeli insurance regulator has increased insurance product transparency, the insurance regulator has issued various rules and circulars, under which insurers must disclose monthly information regarding insurance program, exclusions, limitations, and any updates to rates. The regulator may fine an insurer which breaches these rules, even as much as USD 1 million. In order to increase competition between insurers, the regulator significantly reduced the capital requirement for digital insurers. The regulator aims to lower the requirement from digital insurers in various technical aspects which will enable them to operate more economically and efficiently.
  • The Israeli insurance market will continue to be very competitive, dictating a soft market, especially in personal lines insurance. It is expected that the high level of competition and developments in technology will lead to creative new products in the market and an increase in sales of direct insurance. Insurtech is very developed in Israel. Israeli insurance companies are looking at ways to transform parts of their activities into digital formats, such as the sale of policies, underwriting information and handling of claims, in personal insurance. As a result of the growing competition, digital search engines compare terms and costs of insurance offers by competing insurance companies, to present tools to the consumer to find the most suitable insurance.

Scope of the Report

This report aims to provide a detailed analysis of the life and non-life insurance market in Israel. It focuses on the market dynamics, emerging trends in the segments and regional markets, and insights on various product and application types. Also, it analyses the key players and the competitive landscape in the life and non-life insurance market in Israel.

By Insurance type
Life Insurance
Individual
Group
Non-Life Insurance
Home
Motor
Others
By Channel of Distribution
Direct
Agency
Banks
Other Distribution Channels

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Key Market Trends

Growing Fintech funding in Israel:

  • Israel is one of the technology-driven economies in the world. Israel is poised to become the global hub for insurtech innovation. In 2019, Fintech companies attracted USD 1.7 billion, with the number of deals at the average level of the past 5 years due to four of the largest deals over USD 100 million having been made. In 2019, 9 deals were made with a value of over USD 50 million and overall fundraised amounted to USD 1.2 billion. Israeli tech companies raised USD 2.29 billion. The total amount of capital grew much faster compared to the number of deals. The total amount raised by Israeli high-tech companies increased by 30% compared to the 2018 amount of USD 6.35 billion.
  • Major life insurance companies in the United States are looking at the growth opportunities in Israel and establish strategic partnerships with local InsurTech start-ups. In addition to life insurance companies, some of the world’s biggest financial service firms (including Visa, Mastercard, Citi, Barclays, and JP Morgan) have opened offices in Israel, acquired Israeli FinTech startups or incorporated the services they developed. In 2019, startups in the InsurTech subsector of FinTech raised significant funds throughout the period, accounting for roughly 38% of the total amount raised by FinTech companies, compared to only 15% in 2018. In 2019, Next Insurance raised USD 250 million in equity at an estimated valuation of over USD 1 billion from German insurer Munich Re and a new unicorn was born. This is the second Israeli InsurTech unicorn, along with AI-driven home and renters insurance provider Lemonade, which also contributed to the outstanding year 2019 when it raised USD 300 million from various investors earlier this year. So far, Next Insurance and Lemonade have raised USD 381 million and USD 480 million, respectively. While Next Insurance and Lemonade are responsible for most of the equity raised by InsurTech companies, 93% of the total amount, other companies have also enjoyed financing. In total, one out of every five InsurTech companies has secured funding in 2019.
  • Out of 570 Israeli FinTech companies, approximately 25% offer Trading and Investing solutions, and 23% focus on Payments and Money Transfer. Although these subsectors account for the majority of the FinTech companies, and InsurTech startups account for only 12%, the InsurTech subsector is the one that has experienced the fastest growth in recent years. While in 2014, there were approximately 18 InsurTech companies and in 2019, that number more than quadrupled to 73.

 

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Increase in GDP per capita:

GDP per capita is a very important indicator of the economic strength of a country and a positive change is an indicator of economic growth. Per capita shows the country’s affordability. The per capita income of the country has increased in recent years and expected to continue. Due to an increase in the GDP per capita, it can boost the insurance industry.

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Competitive Landscape

The report covers the major players operating in the life and non-life insurance market in Israel. The market is fragmented, and the rapid growth in investments for insurtech and other few factors will drive the market over the forecast period.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Deliverables

    2. 1.2 Study Assumptions

    3. 1.3 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Market Drivers

    3. 4.3 Market Restraints

    4. 4.4 Porter's Five Forces Analysis

      1. 4.4.1 Threat of New Entrants

      2. 4.4.2 Bargaining Power of Buyers/Consumers

      3. 4.4.3 Bargaining Power of Suppliers

      4. 4.4.4 Threat of Substitute Products

      5. 4.4.5 Intensity of Competitive Rivalry

  5. 5. MARKET SEGMENTATION

    1. 5.1 By Insurance type

      1. 5.1.1 Life Insurance

        1. 5.1.1.1 Individual

        2. 5.1.1.2 Group

      2. 5.1.2 Non-Life Insurance

        1. 5.1.2.1 Home

        2. 5.1.2.2 Motor

        3. 5.1.2.3 Others

    2. 5.2 By Channel of Distribution

      1. 5.2.1 Direct

      2. 5.2.2 Agency

      3. 5.2.3 Banks

      4. 5.2.4 Other Distribution Channels

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Vendor Market Share

    2. 6.2 Mergers and Acquisitions

    3. 6.3 Company Profiles

      1. 6.3.1 Harel Insurance Investments & Finance Services

      2. 6.3.2 Migdal Holdings

      3. 6.3.3 The Phoenix

      4. 6.3.4 Menora Mivtachim

      5. 6.3.5 Clal Insurance Enterprises

      6. 6.3.6 Direct Insurance

      7. 6.3.7 Hachshara Insurance Company

      8. 6.3.8 Ayalon Holdings

      9. 6.3.9 A.I.G

      10. 6.3.10 Shlomo Insurance Company

      11. 6.3.11 Shirbit

      12. 6.3.12 Bituach Haklai

    4. *List Not Exhaustive
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

**Subject to Availability

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Frequently Asked Questions

The Israel Life & Non-Life Insurance Market market is studied from 2016 - 2026.

The Israel Life & Non-Life Insurance Market is growing at a CAGR of <5% over the next 5 years.

Harel Insurance Investments & Finance Services, Migdal Holdings, The Phoenix, Menora Mivtachim, Clal Insurance Enterprises are the major companies operating in Israel Life & Non-Life Insurance Market.

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