Homeowners Insurance Market by Type, Source, and Geography - Forecast and Analysis 2023-2027

Homeowners Insurance Market Forecast 2023-2027 

The Global Homeowners Insurance Market size is estimated to grow by USD 57.01 billion between 2022 and 2027 accelerating at a CAGR of 4.18%. The growth of the market depends on several factors, including the rising number of natural disasters and man-made hazards, the recent development in home insurance, and the rise in government support in form of subsidies.  The increasing occurrence of natural disasters and human-caused risks is driving the preference for homeowner's insurance. Heightened demand for coverage against various accidents such as home damage, asset loss, theft, and fire necessitates insurance companies to innovate and offer comprehensive products ensuring financial protection, including medical expenses. This dynamic contributes to the expansion of the global market.

What will be the Market Size During the Forecast Period?

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Market Segmentation by Type,  Source, Geography

This market report extensively covers market segmentation by type (fire and theft, house damage, floods and earthquake, and others), source (captive, independent agent, and direct response), and geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges.

Type Analysis

The market share growth by the fire and theft segment will be significant during the forecast period. The adoption of fire and theft insurance is high among consumers due to the rising number of accidents, such as external or internal damage to houses, driving the growth of the fire and theft segment.

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The fire and theft segment was valued at USD 77.75 billion in 2017 and continued to grow until 2021.  Fire insurance includes property insurance that covers damage and losses caused by fire. Homeowners mostly prefer to purchase additional coverage in case their property is lost or damaged because of fire. Purchasing additional fire coverage helps to cover the cost of replacement, repair, or reconstruction of property above the limit set by the property insurance policy. Fire insurance policies typically contain general exclusions such as war, nuclear risks, and similar perils. Similarly, theft insurance covers the cost of stolen or damaged assets such as cash, owned goods, and other items. These policies are offered to house owners, leaving them reassured and relieved of financial losses or leaving the property unattended for an extended period. Hence, due to the above-mentioned factors, the adoption of fire and theft insurance is increasing, which is expected to fuel the growth of the fire and theft segment in the global market during the forecast period.

Source Analysis

A captive agent who works only for one insurance firm is known as a captive agent. A captive agent is compensated by the corporation, typically through a mix of salary and commission, as well as perks. He or she might be a full-time employee or a freelancer. Captive agents have an in-depth knowledge of their particular company's insurance products. Moreover, they have good client repo as they spend more time on relationship building, fact-finding, and customer service. Thus, these factors increase the adoption of captive agents for field work to sell insurance to consumers. Such factors are expected to fuel the growth of the captive segment in the global market during the forecast period.

Geographical Analysis

North America is estimated to contribute 47% 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.

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The focused market in North America will grow moderately during the forecast period. This will be mainly because the highest number of claims for catastrophic damage came from North America. This will raise the demand for reinsurance policies for the housing segments in North America. During a catastrophe or calamity, the losses are huge in terms of damage to individual property such as houses. The insured party claims for losses incurred during such calamities, and when the number of claims is massive, the insurance vendor turns to reinsurers for the capital. Hence, the market in North America is expected to grow at a moderate rate during the forecast period.

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Market Dynamics and Customer Landscape

The market is a crucial component of financial security, providing protection against various risks faced by homeowners. Insurance companies offer a range of coverage options tailored to individual needs, with premiums typically determined by factors such as property values, risk profiles, and the prevalence of natural disasters and theft incidents. Government initiatives and insurance awareness campaigns aim to educate clients about the importance of coverage and risk assessment tools to mitigate economic losses due to damage or liability. Technological advancements enable insurers to offer customized insurance products, enhancing flexibility for customers. Despite challenges like insolvency and third-party property damage, the market continues to see growth driven by increasing insurance awareness and demand for comprehensive coverage options. Our researchers analyzed the data with 2022 as the base year and the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Market Drivers

The rising number of natural disasters and man-made hazards is the main reason behind opting for homeowner's insurance. The rise in the demand for home insurance on accidents such as interior or exterior home damage, damage to assets or injury, theft, and fire puts pressure on insurance companies to invest and develop such products that have less proliferation, high coverage, and provide financial security in the form of medical injury or any other damages, which boosts the growth of the global market. Natural disasters such as floods, earthquakes, vandalism, and landslides have led to a surge in the demand for house insurance in recent years. The majority of homeowners rely on house insurance to protect themselves against potential financial losses caused by harm to other people's property, family members, and pets. Moreover, home insurance includes coverage, which helps to compensate policyholders of the family members after his/her death. Such factors are expected to drive the growth of the global market during the forecast period.

Significant Market Trends

New technological developments in the home insurance industry is a major trend. The advancement of technology such as geo-location, application program interface (API), artificial intelligence (Al), data analytics, blockchain, and big data opens up new avenues for insurers in the industry. With these technological advancements, home insurance distribution systems are projected to increase productivity in delivering diverse covers such as additional living expenses (ALE), Renter's insurance, and others at the point of purchase. Furthermore, digital transformation allows home insurance firms to provide highly individualized user experiences to their clients. Furthermore, to preserve their market position in the global market, insurers are investigating the use of big data analytics, which have the potential to generate substantial premiums. Furthermore, technology aid in data collecting, meeting client demands, calculating risks, and detecting fraud. Hence, easy accessibility and convenient home insurance offerings through technological advancements are expected to fuel the growth of the global market during the forecast period.

Major Market Challenges

Vulnerability to cybercrimes is a major challenge in the market. At present, the world is becoming digital and going online to avail diverse benefits such as better-organized data, easy availability of data, multi-screen/multi-device access, efficient handling of client's data, and ease of management. Advances in technology are encouraging online and on-device data storage. The industry relies more on technology, including processing systems, online data, and electronic communications, for ease of business and management. However, the same advances in technology also make data vulnerable to cybercrimes. The incidents of cybercrime include hacking of computers and in-house software as well as intrusion into the intranet portals. The reinsurance industry can be affected by the misappropriation of data on the device or the cloud and then selling the client's confidential information to competitors. Any cybersecurity failure or misuse of data can expose the organization's information to hackers. It can also result in a huge monetary loss, and hence, the problem needs to be addressed at the source. For instance, as a result of silent cyber exposure, the insurance and reinsurance business made a loss of USD 2.7 billion from the Petya/NotPetya cyber-attack. Silent cyber exposures can take place when other sorts of insurance or reinsurance products fail to eliminate cyber risks, which possibly will lead to an accumulation of cyber losses. Such factors may hamper the growth of the global market during the forecast period.

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Who are the Major Market Players?

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. One of the major companies in the market include:

Lemonade Inc. - The key offerings of the company include homeowners insurance.

The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:

• Admiral Group plc
• Allianz SE
• American International Group Inc.
• Amica Mutual Insurance Co.
• AXA Group
• Berkshire Hathaway Inc.
• Chubb Ltd.
• Erie Indemnity Co.
• Liberty Mutual Holding Co. Inc.
• Metlife Inc.
• Nationwide Mutual Insurance Co.
• NJM Insurance Group
• State Farm Mutual Automobile Insurance Co.
• The Allstate Corp.
• The Progressive Corp.
• The Travelers Co. Inc.
• USAA
• Wells Fargo and Co.
• Zurich Insurance Co. Ltd.

Qualitative and quantitative analysis of vendors 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 vendors as pure play, category-focused, industry-focused, and diversified. Furthermore, it is also quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.

Segment Overview

The market research report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. 

• Type Outlook 
  • Fire and theft
  • House damage
  • Floods and earthquake
  • Others
• Source Outlook
  • Captive
  • Independent agent
  • Direct response
• Region Outlook
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa
  • South America
    • Chile
    • Brazil
    • Argentina

Market Analyst Overview

The market is witnessing a dynamic landscape shaped by various factors. Property values, influenced by government initiatives and insurance awareness, drive the need for robust risk assessment tools and advanced technologies. Insurance companies play a pivotal role in offering compensation and liability coverage for risks like third-party property damage. With increasing economic losses, insurers are tailoring customized products to meet diverse customer needs and enhance coverage options. The advent of AI, machine learning, and blockchain technology is revolutionizing online insurance platforms, enhancing operations and offering innovative products. From comprehensive coverage to legal protection, homeowners seek flexible options to safeguard their investments, whether they are landlords, tenants, or homeowners, thus emphasizing the importance of customer satisfaction and ensuring peace of mind in every dwelling.

Moreover, the market is evolving with the advent of customized insurance products tailored to varying risk profiles and individual needs. Insurance providers offer flexibility in premium payment options, allowing customers to select monthly charges based on their financial situation. Comprehensive coverage encompasses dwelling, content, and liability coverage, catering to diverse homeowners' requirements. With increasing home ownership and construction activity, insurers leverage artificial intelligence (AI) and virtual reality (VR) to assess risk profiles accurately. Augmented reality (AR) aids in simplifying the insurance process for customers. The market penetration is expanding as insurers offer tailored solutions for rental property operations and investment properties. As home values fluctuate, insurers ensure dwelling structures are adequately protected against risks, including bodily injury and insolvency. This dynamic market underscores the importance of comprehensive coverage and risk management in safeguarding homeowners' investments and financial well-being.

Market Scope
Report Coverage	Details
Page number	157
Base year	2022
Historic period	2017-2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 4.18%
Market growth 2023-2027	USD 57.01 billion
Market structure	Fragmented
YoY growth 2022-2023(%)	4.06
Regional analysis	North America, Europe, APAC, South America, and Middle East and Africa
Performing market contribution	North America at 47%
Key countries	US, Japan, China, UK, and Germany
Competitive landscape	Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks
Key companies profiled	Admiral Group plc, Allianz SE, American International Group Inc., Amica Mutual Insurance Co., AXA Group, Berkshire Hathaway Inc., Chubb Ltd., Erie Indemnity Co., Lemonade Inc., Liberty Mutual Holding Co. Inc., Metlife Inc., Nationwide Mutual Insurance Co., NJM Insurance Group, State Farm Mutual Automobile Insurance Co., The Allstate Corp., The Progressive Corp., The Travelers Co. Inc., USAA, Wells Fargo and Co., and Zurich Insurance Co. Ltd.
Market dynamics	Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, market growth analysis, market research and growth, market growth and forecasting, Market forecasting, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for 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.

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What are the Key Data Covered in this Market Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2023 and 2027
• Precise estimation of the size of the market size and its contribution of the market in focus to the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Growth of the market industry across North America, Europe, APAC, South America, and Middle East and Africa
• Thorough analysis of the market’s competitive landscape and detailed information about vendors
• Detailed analysis of customer landscape covering Diver of price sensitivity, Adoption of the lifecycle, and key purchase criteria
• Vendor landscape comparing criticality of inputs and factors of differentiation
• Exclusive Matrix on vendor position and classification
• Comprehensive analysis of factors that will challenge the growth of market vendors

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