The usage based insurance market is estimated to be USD 28.43 billion in 2018 and is projected to reach USD 95.81 billion by 2025, at a CAGR of 18.95% from 2018 to 2025
LONDON, Sept. 12, 2018 /PRNewswire/ -- The increasing vehicle sales with telematics and connected car services will drive the global usage-based insurance market for automotive "
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The usage based insurance market is estimated to be USD 28.43 billion in 2018 and is projected to reach USD 95.81 billion by 2025, at a CAGR of 18.95% from 2018 to 2025. The demand for usage-based insurance is driven by the reduction in insurance premiums as compared to regular insurance and risk-related cost and increasing vehicle sales and on-road vehicles. Ambiguity over regulations and legislative environments are acting as a restraining factor for the usage-based insurance market.
Embedded system is estimated to be the fastest growing market in usage-based insurance market by technology
Embedded systems refer to the inbuilt (embedded) telematics inside a vehicle.Embedded system is used to collect vehicle data and analyze the driver behaviour to calculate insurance premiums.
Embedded telematics is very accurate at capturing vehicle data as it is an integrated part of the system and does not require external calibration to register data.This also helps reduce the initial cost as the user does not have to buy separate devices (OBD-II or black box) to avail usage-based insurance.
The market for embedded system-based UBI is directly related to the market for connected cars with inbuilt telematics. The market for connected cars is proliferating, however, the major market is concentrated in North America and Europe.
Light-duty vehicle (LDV) market is estimated to have the largest market in usage-based insurance market by vehicle type
Light-duty vehicles constitute passenger cars and light commercial vehicles, and account for almost 96% of the total global vehicle sales in 2017, as per OICA.The adoption rate of UBI is higher in LDVs than it is in HDVs.
LDVs can be easily fitted with OBD-II, black box or other devices to access the usage-based insurance plans. Additionally, LDVs are generally driven by a single person, hence UBI plans based on driver behaviour are more prominent for LDVs, while the same is not true for HDVs as they have multiple drivers.
Asia Oceania is estimated to be the fastest growing region in usage-based insurance market for automotive during the forecast period
The usage-based insurance market in Asia Oceania is in a very nascent stage in the present scenario.However, it is expected to be the fastest growing, in terms of value, because of the largest vehicle sales and on-road vehicles.
The increased adoption rate of telematics and connected car services and huge vehicle sales and parc are fueling the usage-based insurance market in Asia Oceania.This region is expected to continue its dominance in vehicle sales in the coming years as compared to the other regions.
China and Japan are expected to be the prominent markets for usage-based insurance in Asia Oceania region.
The study contains insights provided by various industry experts.
The breakup of the primaries is as follows:
• By Company Type: Tier-1 — 50%, Tier-2 — 30%, and OEMs — 20%
• By Designation: D level — 50%, C level — 35% Other — 15%
• By Region: The Americas — 40%, Europe — 40%, Asia Oceania — 20%
Note: Others includes sales managers, marketing managers, and product managers.
Note: OEMs are car manufacturers, Tier-1 companies are usage-based insurance and telematics service providers, and Tier-2 companies are insurance providers.
The usage-based insurance market consists of companies such as Progressive Corporation (US), Vodafone (UK), Allstate (US), Octo Telematics (UK), TomTom (Netherlands), Allianz (Germany), AXA (France), Liberty Mutual (US), Verizon (US), and Sierra Wireless (Canada).
Research Coverage
The usage-based insurance market for automotive has been segmented on the basis of package type [Pay-As-You-Drive (PAYD), Pay-How-You-Drive (PHYD), and Manage-How-You-Drive (MHYD)], technology (OBD-II, smartphone, embedded system, black box, and others), vehicle type (light-duty vehicle and heavy-duty vehicle), vehicle age (new vehicles and on-road vehicles), device offering type [(bring your own device (BYOD) and company provided)], and region [Asia Oceania (China, Japan, India, South Korea, and rest of Asia Oceania), Europe & Middle East (EME) (Italy, UK, Germany, France, Spain, Russia, UAE, and rest of EME), and the Americas (US, Canada, Mexico, Brazil, and rest of the Americas)]. The study also segments the usage-based insurance market by electric & hybrid vehicle type (BEV, HEV, and PHEV).
Reasons to Buy the Report:
This report provides insights with reference to the following points:
• Market Size, by technology: The report offers in-depth market sizing and forecast up to 2025, by technology such as OBD-II, smartphone, embedded system, black box, and others. The market sizing for technology is covered for all regions.
• Market Size, by package type: The report offers in-depth market sizing and forecast up to 2025, by package type such as pay-as-you-drive, pay-how-you-drive, and manage-how-you-drive. The market sizing for package type is covered for all countries considered in the study
• Market Size, by vehicle type: The report offers in-depth market sizing and forecast up to 2025, by vehicle type such as light-duty vehicle and heavy-duty vehicle. The market sizing for vehicle age is covered for all countries considered in the study
• The report covers the usage-based insurance market for "Electric and Hybrid Vehicles" at a regional level, by vehicle type.
• The report provides "Market Share" of the leading players in the usage-based insurance market.
• Market Development: The report provides comprehensive information about lucrative emerging markets for usage-based insurance across regions.
• Product Development/Innovation: The report gives detailed insights into R&D activities, upcoming technologies, and new product launches in the usage-based insurance market.
• Market Diversification: The report offers detailed information about untapped markets, investments, new products, and recent developments in the usage-based insurance market.
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