Usage Based Insurance Market Size, Share, Growth, Trends, Production, Consumption and Forecast 2019 to 2026

Published Date : Jan 2020 | No. of Pages : 140 Pages | Category :

The Global Usage-based Insurance Market is poised to grow at CAGR above 29 % over the forecast time frame 2019-2026 and reach the market value around USD 190 billion by 2026.

Rising demand for accurate quotation of motor insurance among consumers, as a result of rising claims and fraud increasing the motor premium, is driving the Usage-based insurance market. Penetration of UBI is considerably high in Italy and South Africa, owing to high motor insurance cost due to high rate of theft/fraud in these countries. Insurance companies are taking active measures with pilot programs launched worldwide to boost the penetration of UBI.

Declining prices of connecting devices and connected mobility technologies is fueling the adoption of UBI. Demand for appropriate premium charges among consumers is rising, as conventional insurance charges a safe and rash driver equally. The UBI insurance model has variable charges based on the safe driving behavior of the driver and hence, demand for this model is expected to rise in the near future. The motor insurance industry is facing losses due to increasing competition and cost of claims. UBI insurance helps assess better risk and maintain profitability.

Increasing use of insurance models such as PAYD and PHYD contributes to the growth in the use-basis insurance market. UBI determined the premium on the basis of driving behavior by insurance companies. In order to monitor motive patterns, telematics and other communication technologies will lead to an excellent growth of the market over the projected timeline. Factors, such as increasing popularity of managing solutions, increased penetration of smartphones and an increase in UBI usage by insurance companies in order to enhance profitability are attributed to the market growth. Use-based insurance enables insurers to assess risks on the basis of the profile of individual drivers, travel characteristics and the actual vehicle condition. This helps them to improve their risk assessment and to prevent fraudulent claims. Insurers use telematics insurance to increase their customer base by using driving information to improve policy pricing.

The use of telematic smartphones enables carmakers and insurers to collect driving data and record the hard braking and acceleration trip parameters. They use the driving data to design insurance policies based on usage and to determine the premium of the policyholder. The enormous adoption of intelligent telecoms is likely to drive the growth of the use-based market for insurance.

In terms of policy type, the pay-as-you-drive (PAYD) segment held a dominant share of the global market. PAYD is a simple UBI model based on miles driven and hence, is widely accepted. Increasing adoption of telematics and advanced driver assistance features is projected to boost the pay-how-you-drive (PHYD) segment in the near future. PHYD takes into account various parameters such as acceleration, time of ride, route of ride, and sudden braking, and is more effective in gauging the risk of the driver.

Based on device type, the black box segment held a leading share of the global Usage-based insurance market. However, the smartphone segment is expected to expand in the near future, as it is a low-cost solution with no additional investment.

Based on region, the global usage-based insurance market has been segmented into North America, Latin America, Europe, Asia Pacific, and Middle East & Africa. North America and Europe is expected to lead the global Usage-based insurance market, owing to higher adoption of telematics supporting the UBI working and consumer awareness.

Key Players & Strategies

Progressive, AllState Insurance Company, AXA, AA, Allianz, Uniqa, Generalli, MAIF, Groupama, Aviva, Uniposai, Insure the Box, State Farm and Liberty Mutual are key players in the global UBI market.

Other operators include as their key strategies for increasing their market share, players have taken partnership and expansion. The Progressive Corporation, for example, has entered into a partnership with Zubie. The established players are strongly competitive by local firms such as Admiral Group plc, Allstate Corporation and others, mainly within advanced markets. Privacy concerns have presented major challenges for manufacturers and increasing telematics installation costs. The report discusses the key development strategies adopted by the companies.

The report analyzes and forecasts the usage based insurance market at global and regional levels. The market has been forecast based on volume (Tons) and value (US$ Mn) from 2019 to 2026. The study includes drivers and restraints of the global market. It covers the impact of these drivers and restraints on the demand during the forecast period. The report also highlights opportunities in the market at the global level.

The report comprises a detailed value chain analysis, which provides a comprehensive view of the global usage based insurance market. The Porter’s Five Forces model has also been included to help understand the competitive landscape of the market. The study encompasses market attractiveness analysis, wherein various applications have been benchmarked based on their market size, growth rate, and general attractiveness.

The study provides a decisive view of the usage based insurance market by segmenting it in terms of form and application. The segment has been analyzed based on the present and future trends. Regional segmentation includes the current and projected demand in North America, Europe, Asia Pacific, Latin America, and Middle East & Africa.

The report provides size (in terms of volume and value) of usage based insurance market for the base year 2018 and the forecast between 2019 and 2026. Market numbers have been estimated based on form and application. Market size and forecast for each application segment have been provided for the global and regional market.

The global usage-based insurance market has been segmented as follows:

  • By Policy Type
    • PHYD
    • PAYD
    • MHYD
  • By Device Type
    • Black Box
    • OBD Dongle
    • Smartphone
    • Others
  • By Vehicle Type
    • Passenger Vehicle
    • Commercial Vehicle
  • By Region
    • North America
      • U.S.
      • Canada
    • Europe
      • Germany
      • France
      • U.K.
      • Spain
      • Italy
      • Rest of Europe
    • Asia Pacific
      • Japan
      • China
      • India
      • Australia/New-Zealand
      • Rest of Asia Pacific
    • Middle East & Africa
      • GCC
      • South Africa
      • Rest of Middle East & Africa
    • Latin America
      • Brazil
      • Mexico
      • Rest of Latin America

Reasons to Purchase this Report:

- Market segmentation analysis including qualitative and quantitative research incorporating the impact of economic and policy aspects
- Regional and country level analysis integrating the demand and supply forces that are influencing the growth of the market.
- Market value USD Million and volume Units Million data for each segment and sub-segment
- Competitive landscape involving the market share of major players, along with the new projects and strategies adopted by players in the past five years
- Comprehensive company profiles covering the product offerings, key financial information, recent developments, SWOT analysis, and strategies employed by the major market players

Research Methodology:

In-depth interviews and discussions were conducted with several key market participants and opinion leaders to compile the research report.

Primary research represents a bulk of research efforts, supplemented by extensive secondary research. Annual reports, press releases, and relevant documents of key players operating in various application areas have been reviewed for competition analysis and market understanding.

Secondary research also includes recent trends, technical writing, Internet sources, and statistical data from government websites, trade associations, and agencies. These have proved to be reliable, effective, and successful approaches for obtaining precise market data, capturing market participants’ insights, and recognizing business opportunities.

The study objectives of this report are:

  • To analyze and study the global usage based insurance capacity, production, value, consumption, status (2014-2018) and forecast (2019-2026);
  • Focuses on the key usage based insurance manufacturers, to study the capacity, production, value, market share and development plans in future.
  • Comprehensive company profiles covering the product offerings, key financial information, recent developments, SWOT analysis, and strategies employed by the major market players
  • To define, describe and forecast the market by type, application and region.
  • To analyze the global and key regions market potential and advantage, opportunity and challenge, restraints and risks.
  • To identify significant trends and factors driving or inhibiting the market growth.
  • To analyze the opportunities in the market for stakeholders by identifying the high growth segments.
  • To strategically analyze each submarket with respect to individual growth trend and their contribution to the market
  • To analyze competitive developments such as expansions, agreements, new product launches, and acquisitions in the market
  • To strategically profile the key players and comprehensively analyze their growth strategies.

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