About 80% of general and life insurers worldwide will have either partnered with or acquired insurtechs by the end of 2018, according to researcher Gartner.

It says 64% of the 25 biggest insurers have already invested in start-ups directly or indirectly via their venture capital arms.

The growing interest marks a shift in the industry, which initially struggled to respond to the rising number of technology start-ups offering insurance services.

But while insurers have come to realise the commercial benefits of insurtechs, many still do not fully understand these companies, the researcher says.

“Gartner has seen growing interest among insurance business and IT leaders in collaborating with insurtechs or making them part of their overall innovation policies, but the research has also found most insurance chief information officers (CIOs) are not familiar with these companies or their value propositions,” Managing VP Juergen Weiss said.

“We advise CIOs to identify areas where insurtechs could complement their digital insurance strategies, and evaluate potential collaboration or investments.”

Gartner defines insurtechs as the users of new technology to provide insurance-related services, with funding not limited to venture capital.

About 60% of insurtechs have been established in the past three years, and two-thirds are headquartered in the US.

Digital customer engagement, mobile insurance management and analytics are the most common areas of focus.