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The motor vehicle insurance market size is forecast to increase by USD 405.19 billion, at a CAGR of 8.68% between 2022 and 2027. Market expansion hinges on various factors, such as heightened government regulations mandating insurance coverage in developing nations, surging automobile sales, and a growing incidence of accidents. These dynamics collectively influence the trajectory of the market, driving demand for insurance products and services. With regulatory mandates compelling individuals to secure insurance coverage, particularly in emerging economies, the market experiences a boost in demand. Additionally, the uptick in vehicle sales contributes to the market's growth, as more vehicles on the road necessitate insurance protection. Moreover, the rising frequency of accidents underscores the importance of insurance, prompting individuals to seek coverage for financial protection. Together, these factors shape the market landscape, highlighting the interplay between regulatory mandates, consumer behavior, and market dynamics in driving growth within the insurance sector.
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In the market, motor insurance companies cater to prospective consumers across various health insurance segments and motor insurance segments within the non-life insurance industry. Each current year presents unique challenges compared to the previous year, especially in the dynamic automotive sector. With rising disposable income, personal transportation becomes more prevalent, necessitating coverage for vehicle owners against risks and liabilities. Usage-based insurance programs leverage driving habits to determine premiums and streamline the claims process, enhancing customer experience in this essential financial protection service for cars, trucks, motorcycles, and other vehicles.
This market report extensively covers market segmentation by application (personal and commercial), distribution channel (brokers, direct, banks, and others), and geography (North America, APAC, Europe, South America, and the Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
The market share growth by the personal segment will be significant during the forecast period. A personal insurance cover in motor vehicle insurance can be referred to as a financial facility for the owner or driver of the vehicle. It is a mandatory extension that is supposed to be taken by the owner of the vehicle under the Motor Policy, whether opting for a Comprehensive Package or Third-Party Liability Policy and it is mainly issued in the name of the owner of the vehicle, and the owner is entitled to the cover only if they possess a valid driving license.
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The personal segment was valued at USD 536.82 billion in 2017. One of the key benefits of personal insurance is that it is an add-on cover that provides protection against any accidental injuries to the owner or driver of the insured motor vehicle. In addition, other benefits include compensation in case the owner or driver of the vehicle has a permanent disability, bodily injuries, or death caused due to the motor vehicle accident. Hence, such factors are expected to drive the growth of this segment which in turn will drive the growth of the drive the global motor vehicle insurance market during the forecast period.
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North America is estimated to contribute 41% 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. One of the key factors for the stability of the motor vehicle insurance market in North America is the presence of a regulatory environment in the region. The regulatory framework is well-established in the region and is designed in such a way as to protect consumers and ensure fair competition among insurers. These legal bodies also work with insurance companies to promote market stability, consumer protection, and financial soundness within the industry. Factors such as the sensitivity of the public in the region toward personal safety and the safety of one's property and the region's mature market of smartphone users are driving the global motor vehicle insurance market in the region during the forecast period.
Automation in the market is revolutionizing operations, offering sustainable insurance options and streamlining processes for auto and car insurance. With the ever-increasing necessity for coverage against damages, innovations like Artificial Intelligence, Internet of Things, and Machine Learning are reshaping the landscape. Digital adoption through agents, portals, and apps enhances accessibility, contributing to the insurance market's growth. These advancements aim to boost insurance penetration rates by raising awareness and meeting the demand for protection products amid a rising number of annual domestic passenger vehicles. 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.
One of the key factors driving market growth is the increasing government regulations on mandatory insurance coverage in developing countries. Most of the countries worldwide such as India and China have made it mandatory that motor insurance is required for any vehicle that runs on public roads. For instance, anyone who owns or operates a vehicle in Maine, US, must carry at least the minimum amount of insurance required by the law. The law requires uninsured/underinsured motorist coverage at a minimum of USD 50,000 per person or USD 100,000 per accident.
Further, as the global economy is growing, there is a significant increase in the number of vehicles in those developing countries which in turn is significantly driving the market. Factors such as Insurance becoming mandatory for citizens and increasing government regulations on mandatory insurance coverage in developing countries are expected to drive the global motor vehicle insurance market during the forecast period.
A key factor shaping market growth is the digitalization of the motor vehicle insurance industry. Digitization has revolutionized the motor vehicle insurance market in certain ways over the years. Motor vehicle insurance companies have shifted their focus toward providing more convenient, efficient, and personalized services to their clients due to the rapid advancement in technology. One of the key transitions that happened with the advancement of digitization is that it has transformed the way customers interact with motor vehicle insurance companies
Also, another significant impact of digitization in the motor vehicle insurance market is the emergence of Insurtech companies. With the help of technology, these companies are curating personalized motor vehicle insurance products and services that are tailored to customer preferences. Hence, such factors are expected to drive the global motor vehicle insurance market during the forecast period.
Tightening the regulatory environment for insurance players is one of the key challenges hindering market growth. There are increasing introductions of regulations and establishment of regulatory bodies regarding motor vehicle insurance across countries such as Australia and the US. For instance, Australia has two regulatory bodies for insurance players, namely the Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC).
Additionally, In the US, for the implementation of more uniform rules and regulations on motor vehicle insurance, the country has its own regulatory body called the National Association of Insurance Commissioners (NAIC). Therefore, due to the increasing number of government regulations, motor vehicle insurance companies may face a significant threat of increased prerequisites for the motor vehicle insurance industry. This will directly impact the market its revenue which is expected to hinder the global motor vehicle insurance market during the forecast period.
The market 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 forecasting 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.
Allianz SE: The company offers motor vehicle insurance under the brand, Bajaj Allianz.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 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 adapting to digital trends, with a surge in portals/apps offering online insurance policies and discounts. As internet penetration grows, consumers seek convenient digital payment options like debit cards, credit cards, and digital wallets for premium payments. Advanced safety technologies and autonomous driving systems are reshaping accident frequency and severity, prompting insurers to emphasize eco-friendly practices and paperless policies to reduce carbon footprint. Liability coverage, collision coverage, and comprehensive insurance cater to various needs, while medical payment coverage and personal injury protection insurance address medical expenses. As regulatory requirements evolve, the market anticipates further growth, ensuring financial safety for property damages and bodily injuries while promoting road safety and customer satisfaction.
Further, the market is influenced by various factors such as the rise of Electric vehicles and demand for cars, driving the need for advanced safety technologies like Advanced Chemistry Cell and Green vehicle technology. As annual domestic passenger vehicle numbers increase, insurers assess accident severity and ensure compliance with traffic and safety regulations. Online insurance segment growth introduces challenges like scams and misleading information, countered by mandatory deductibles and no-claim bonuses. Digital payments and direct bank transfers streamline transactions, while aggregators facilitate policy comparisons. Insurers manage loss ratios and claims settlement ratios, focusing on loyalty metrics and customer satisfaction. Uninsured motor insurance and underinsured motor insurance coverage address gaps, ensuring financial protection against financial losses and property damage in road accidents. Compliance with rules & regulations ensures a simpler product with comprehensive third party liability coverage.
Market Scope |
|
Report Coverage |
Details |
Page number |
163 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 8.68% |
Market growth 2023-2027 |
USD 405.19 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
8.25 |
Regional analysis |
North America, APAC, Europe, South America, and Middle East and Africa |
Performing market contribution |
North America at 41% |
Key countries |
US, China, Japan, UK, and France |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Allianz SE, American International Group Inc., Aviva Plc, AXA Group, Berkshire Hathaway Inc., Chubb Ltd., Desjardins Group, Discovery Ltd., Kotak Mahindra Bank Ltd., Liberty Mutual Holding Co. Inc., Navi Technologies Ltd, OCTO Telematics S.p.A, Reliance Capital Ltd., Sompo Holdings Inc., State Farm Mutual Automobile Insurance Co., The Allstate Corp., The Hanover Insurance Group Inc., The Progressive Corp., The Travelers Co. Inc., and Zurich Insurance Co. Ltd. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Distribution Channel
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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