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The Insurance Software Market size is estimated to grow by USD 6.45 billion at a CAGR of 7.22% between 2022 and 2027. Market growth relies on various factors, notably the escalation of government regulations mandating insurance coverage in developing nations, the heightened demand for insurance due to uncertain catastrophic events, and the growing adoption of insurance services in emerging economies. Particularly in developing countries, stringent government regulations compel individuals and businesses to obtain insurance coverage, driving market expansion. Moreover, the unpredictable occurrence of catastrophic events such as natural disasters or pandemics amplifies the necessity for insurance, prompting individuals and businesses to seek financial protection. This heightened awareness of risk mitigation further stimulates the uptake of insurance services. Additionally, the increasing recognition of insurance as a crucial financial tool in safeguarding against unforeseen circumstances fuels its adoption across emerging markets. Consequently, the confluence of regulatory mandates, risk awareness, and evolving financial practices propels the growth trajectory of the insurance market in developing countries.
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In the market, catering to policyholder's behavior and preferences is paramount. Digital insurance channels, including mobile apps and online portals, offer convenient access to services. Automation streamlines processes, tackling the complexity of insurance operations while ensuring flexibility for open enrollment. Insurance software solutions empower insurers to adapt to evolving customer needs and market demands efficiently.
This report extensively covers market segmentation by deployment (on-premises and cloud-based), type (life insurance, accident and health insurance, property and casualty insurance, and others), and geography (North America, APAC, Europe, Middle East and Africa, and South America).
The market share growth by the on-premises segment will be significant during the forecast period. The market is mainly operated by large organizations that consider data privacy and security a priority. These organizations focus more on functionality than on cost-effectiveness. The high security and data privacy offered by the on-premises deployment model drive market growth.
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The on-premises segment USD 9.54 billion in 2017. The growth of this segment can be attributed to various unique properties of the on-premises deployment model Some of them include an organization's complete control over the in-house server, IT infrastructure, in-house IT team, and intranet; the usage of the software in core applications by company branches that operate out of rural areas that may not have proper internet access to use the cloud as the primary mode of conducting business; and unlike the cloud software, the on-premise software used by insurance companies have control over the maintenance of data security and privacy and adherence to government rules, regulations, and protocols. In this technologically advanced and threat-enhanced environment, enterprise risk management is of prime importance. Hence, the above-mentioned factors are expected to fuel the growth of the on-premises segment in the global market during the forecast period.
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North America is estimated to contribute 36% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. North America has been the largest market in the world in terms of gross written premium volume of insurance policies. With a steady revenue flow in the industry, several technology-driven innovations are expected to be implemented. This is expected to create a demand. Other key factors propelling the growth of the market in North America are the highly industrialized economy of several countries and the significant use of the internet for payments and data transactions within or between organizations.
Further, since the dependency on the internet, wireless technologies, and cloud-based services is high in North America, organizations in this region are increasing their spending on advanced solutions to remain competitive in the market. Furthermore, technologies such as AI and the IoT are gaining high traction among end-user industries. For instance, Wipro Ltd. Provides an IoT-based insurance solution named Insurance connected IoT, which helps insurers to collect granular data from a vast number of connected sensors to enable cost control, risk control, variable pricing, and to drive customer propositions. This is expected to support the growth of the market in the region during the forecast period.
In today's insurance landscape, meeting customer expectations is key amid regulatory changes and evolving compliance requirements. Insurance software leverages machine learning and predictive analytics to anticipate policyholder behavior and adapt to changing circumstances. Streamlining claims assessment and the settlement process reduces administrative overhead while enhancing customer satisfaction. With features like chatbots, virtual assistants, and smart contracts, digital platforms facilitate transactions and manage tokenized assets efficiently. Integration of quantum computing and cloud technology ensures fraud detection and system scalability, navigating the complexities of the industry's legacy systems and optimizing operational costs. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The increasing adoption of insurance in developing countries is notably driving market growth. The markets in developed countries have become saturated. This is because of the increased awareness and early adoption of these by consumers. Moreover, developed nations have stringent government regulations for the subscription to insurance, including insurance for life and health, property and casualty, or specialties such as marine and aviation. Solution providers in the insurance industry are increasingly leveraging artificial intelligence (AI) technology to improve their operations, including managing outstanding claim reserves, developing innovative software solutions for policy management, and streamlining claims processing.
Furthermore, the digital transformation of these has resulted in a rapid increase in the demand for upgraded customer-facing software. With the increasing demand in developing countries, the demand for software is growing at a fast pace. The traditional methods are no longer adapted. In mature markets, insurers are moving all the new and existing policies to digital platforms. Thus, we expect to see a manifold increase in the importance and growth of the market during the forecast period.
Integration of wearables into customer engagement metrics for the market is an emerging trend in the market. The adoption of sensor-based wearables is redefining customer engagement methods and processes for life insurers. These wearables aid in the real-time tracking of customer lifestyle habits, physical activity levels, and food habits. Real-time consumer data provides insurers with immense opportunities to improve their services and make appropriate business decisions. In addition, based on the most recent data, they can suggest or come up with modified products to suit customer lifestyles and maximize company profits by minimizing the risks.
The features of wearables can only be used if they are integrated into online offerings. The insurance software can use the collected data to perform analysis not only for an individual but at a mass scale to redefine the product portfolio and redesign clauses for claims and disbursal. Hence, the above-mentioned factors are expected to fuel the growth of the market in focus during the forecast period.
The changing skill requirements are major challenges impeding the market. Technological advances are driving the insurance industry. Customer-facing applications are being introduced in the market. In addition, data analytics is increasingly being integrated into the main offering to derive insights, detect fraud, and predict claim patterns. The use of technologies, such as blockchain can increase the efficiency and security of paperwork. This assures customers of the safety of their credentials and classified data. However, the right skills are required to understand and use such high-tech innovations. companies can make the software user-friendly as the market is becoming customer-centric.
In addition, customer trust in the brand increases if they can understand the process. Thus, the data needs to be readable and comprehensible to customers so that it is useful to them. The industry is facing a challenge in finding a skilled workforce to implement digital innovations. This is hindering technology adoption among insurance companies. Hence, such factors are expected to hamper the growth of the global market during the forecast period.
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the market forecast report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Axxis Systems SA -The company operates in one segment which offers software business for third-party companies. The key offerings of the company include insurance software.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2023 to 2027, as well as historical data from 2017 to 2022 for the following segments
The market is witnessing a surge in demand driven by the increasing frequency of cyberattacks and natural disasters, highlighting the need for robust cybersecurity solutions and comprehensive coverage. To address these challenges, insurers are turning to digital solutions and risk assessment tools to enhance efficiency gains and customer experiences while ensuring operational agility. This shift towards digitization is accompanied by a focus on pricing models that align with modern businesses' needs and regulatory requirements. Leveraging blockchain technology, insurers are exploring decentralized and secure ledger systems to streamline claim processes, mitigate fraud, and foster an efficient and trustworthy ecosystem. Additionally, the adoption of SaaS-based solutions is increasing, offering enhanced accessibility and automatic updates while reducing infrastructure costs. As insurers aim to modernize and optimize operations, they prioritize comprehensive cybersecurity solutions to address sophisticated cyber threats and safeguard digital assets against data breaches.
Further, the market is undergoing rapid evolution, driven by the need for efficient natural disaster claims processing and robust cybersecurity software. Insurers are leveraging advanced firewalls, antivirus programs, and threat intelligence platforms to safeguard sensitive information and fortify digital operations and digital footprint against emerging cybersecurity concerns. Emphasis on awareness of cyber risks underscores the importance of adopting a decentralized and secure ledger system to ensure transparency and foster increased trust among stakeholders. Furthermore, insurers are investing in solutions that enable streamlined processes, deliver enhanced customer experiences, and facilitate improved data analytics to maintain competitiveness in the market. The focus is on developing robust software solutions across various insurance sectors, including Life and Annuity, Reinsurance, Commercial Property/Casualty, and Personal Property/Casualty, all while ensuring seamless software deployment and internet connection.
Market Scope |
|
Report Coverage |
Details |
Page number |
173 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 7.22% |
Market growth 2023-2027 |
USD 6.45 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
6.66 |
Regional analysis |
North America, APAC, Europe, Middle East and Africa, and South America |
Performing market contribution |
North America at 36% |
Key countries |
US, China, Japan, UK, and France |
Competitive landscape |
Leading companies, Market Positioning of companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Accenture Plc, Acturis Group, Applied Systems Inc., Aptitude Software Group Plc, Axxis Systems SA, Dell Technologies Inc., Ebix Inc., Enlyte, Guidewire Software Inc., Hyland Software Inc., International Business Machines Corp., Jenesis Software, Microsoft Corp., Nest Innovative Solutions Pvt. Ltd., Oracle Corp., Rocket Software Inc., Roper Technologies Inc., Salesforce.com Inc., SAP SE, and Solartis LLC |
Market dynamics |
Parent market analysis, market growth and trends, Market forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our market research report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Deployment
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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