Disruption and changes caused by the Covid-19 pandemic has created an unpredictable near-term for some fledgeling insurtech businesses.There are questions about how much demand there will be for certain insurance technology ideas that had looked good before the pandemic, but were aimed at risks that now could be fundamentally changed.And traditional insurance and reinsurance companies that have not made, or be in the process of making, digital transformations are in danger of becoming obsolete.Those are thoughts presented in the latest Willis Towers Watson InsurTech Briefing.The briefing is a collaboration between Willis Re, Insurance Consulting and Technology, and CB Insights.Global funding of insurtech businesses and start-ups increased to $1.56 billion in the second quarter, an improvement of 71 per cent on the first three months of the year.That figure involves 74 deals in the insurtech space between the start of April and the end of June.Andrew Johnston, global head of insurtech, Willis Re, said: “Businesses in our industry are now either fully floating on the digital rafts they have been inflating for years or digitising increasingly and relying more and more on remote systems (increasingly cloud-based) that can support electronic quoting, policy binding and issuance, and claims paying technology, to name but a few functions.”He said if a (re)insurer is still unable to digitally and remotely procure business, quote business, distribute product and service a living policy up until the contract ends or a claim is made, then it is leaving itself vulnerable to obsolescence.Dr Johnston also said a development of the second quarter was the number of insurtechs obtaining or planning to obtain carrier status through acquisitions, “including Hippo’s acquisition of Spinnaker, Buckle’s acquisition of Gateway Insurance Co, and Pie Insurance’s $127 million round that earmarks $100 million to purchase licensed insurance companies”.During this month, Lemonade becomes the first public US “insurtech unicorn”.Dr Johnson said: “In addition to the speculation of short-term returns and survival speculation of some highly leveraged insurtechs, certain risks and their associated vectors have fundamentally changed — and could be changed for ever.“Will the travel insurance industry ever be as buoyant again? Will we ever drive as much again? Will we all have offices in our home? The short answer is possibly yes, possibly no.“As such, we anticipate seeing a fairly unpredictable next 12 months of activity.”He added: ‘While insurtechs are probably much more adept at hibernating than their incumbent relatives, if the use case of a business has been lost for ever through fundamental change, or the prospect of ever ‘making it’ now seems (more) unlikely, then many founders may cut their losses and move on.”