The global auto insurance market size was around USD 859.56 Bn in 2022 and is likely to reach USD 1,220.35 Bn by 2031, expanding at a CAGR of 9.1% during 2023–2031. The growth of the market is attributed to the rapid expansion of the automotive industry and rising disposable income of consumers.
Auto insurance, also known as motor insurance, is a policy that deals with vehicles including bikes, cars, trucks, and other driver’s vehicles, which includes an agreement between the vehicle owner and the insurance company. It provides cover for loss, fire, or any physical damages to the vehicle. Having auto insurance protects the owner against financial loss if the owner is involved in an accident.
Auto insurance offers coverage in order to offset the cost of vehicle damages, bodily injuries to the owner or passengers caused by an accident, lost wages, medical bills associated with injuries, and full settlement of insurance to the nominee holder in case of death in an accident.
The market report find that the COVID-19 pandemic affected the market, due to a reduction in the accident rate. This reduction was due to preventive measures imposed by the government such as emergency lockdowns and several restrictions on traveling, which decreased the usage of public transportation and significantly decreased the traffic flow. Thus, fewer crashes and injuries on the road hampered the market during the pandemic.
Auto Insurance Market Dynamics
Major Drivers
High usage of auto insurance in developing countries is a major factor driving the market. Auto insurance protects against financial losses in case of an accident, theft, fire, or any kind of physical damage to the vehicle. However, increasing disposable income and rising spending on automobiles for good maintenance of vehicles encouraged them to use auto insurance, which boosts the market during the forecast period.
Rising government initiatives for mandating auto insurance accelerate the market. The Insurance Regulatory and Development Authority of India (IRDAI) mandated a 3-year insurance policy for cars and a 5-year insurance policy for bikes at the time of sale and registration, which fuel the market in the coming years. Furthermore, rising number of accidents across the globe, due to the increasing incidence of traffic, rash driving, and drinking and driving, is likely to propel the market.
Existing Restraints
The lack of awareness regarding the benefits of auto insurance, especially in rural areas of developing countries, is likely to hinder the market to a certain limit. As per the Insurance Information Bureau, only 6.5 to 7 crores of 18 crore registered cars in India has insurance.
Emerging Opportunities
The emergence of different plans and add-ons to provide better coverages are likely to create immense opportunities in the market. Furthermore, the pay-as-you-drive policy allows owners to insure vehicles for kilometers, which is likely to fuel the market during the projected period.
Scope of Auto Insurance Market Report
The market report includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.
|
Attributes
|
Details
|
|
Report Title
|
Auto Insurance Market - Global Industry Analysis, Growth, Share, Size, Trends, and Forecast
|
|
Base Year
|
2022
|
|
Historic Data
|
2016–2021
|
|
Forecast Period
|
2023–2031
|
|
Segmentation
|
Coverage (Third-party Liability, Comprehensive, Personal Injury Protection, Full Coverage, and Others), Distribution Channel (Direct Response, Agents/Brokers, Banks, and Others), and Application (Personal Vehicles and Commercial Vehicles), Vehicle Type (Light Motor Vehicles, Passenger Cars, Light Commercial Vehicles, and Heavy Commercial Vehicles)
|
|
Regional Scope
|
Asia Pacific, North America, Latin America, Europe, and Middle East & Africa
|
|
Report Coverage
|
Company Share, Market Analysis and Size, Competitive Landscape, Growth Factors, Market Trends, and Revenue Forecast
|
|
Key Players Covered in the Report
|
Admiral Group Plc; Allianz; Allstate Insurance Company; Assicurazioni Generali S.p.A.; Bajaj Allianz General Insurance Co. Ltd.; GEICO; HDFC ERGO General Insurance Company Limited; ICICI Lombard General Insurance Company Limited; Ping An Insurance (Group) Company of China, Ltd.; State Farm Mutual Automobile Insurance Company; Tata AIG General Insurance Company Limited; and The New India Assurance Co. Ltd.
|
Auto Insurance Market Segment Insights
On the basis of coverage, the auto insurance market is segmented into third-party liability, comprehensive, personal injury protection, full coverage, and others. The third-party liability segment held a large share of the market in 2021 and is expected to expand at a considerable CAGR in the coming years, as it offers diverse insurance options. This type of insurance defends against third-party claims. It compensates any damage caused to the third-party such as death, property damage, and disability.
The comprehensive segment is anticipated to grow at a rapid pace during the projection period as it covers the third-party damages as well as the damages caused to the others vehicles. This type of insurance allows owners to replace or repair their vehicle if it is stolen or suffers damage in an accident.
Based on distribution channel, the market is divided into direct response, agents/brokers, banks, and others. The direct response segment is anticipated to hold a key share of the market during the assessment period, due to the rising consumer preference for web-based services. The direct response includes selling insurance directly through telephone, direct mail, and online platforms. It enhances the customer experience by offering easy and quick access to policies.
The agents/brokers segment is projected to grow at a significant pace during the projection period, due to the rising demand for customized services. It helps vehicle owners select the best coverage option based on their budget and needs.
On the basis of application, the auto insurance market is bifurcated into personal vehicles and commercial vehicles. The personal vehicles segment is anticipated to register a robust growth rate during the forecast period, due to the rising sale of cars and bikes. The segment growth is further attributed to the increasing purchasing power of the population and the rising usage of two-wheelers among the middle-class population.
Based on vehicle type, the market is segregated into light motor vehicles, passenger cars, light commercial vehicles, and heavy commercial vehicles. The heavy commercial vehicles segment is anticipated to expand at a high CAGR in during the forecast period, owing to the rising transportation activities across the globe. However, the passenger cars segment is estimated to grow at a significant pace, owing to the rising adoption of passenger cars in rural areas of developing countries.
In terms of region, the global auto insurance market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. Asia Pacific is projected to dominate the market during the forecast period, due to the rising incidences of traffic, accidents, and theft rates. Furthermore, growing awareness regarding the benefits of auto insurance and rising per capita income of consumers are likely to boost the market.
Segments
The global auto insurance market has been segmented on the basis of
Coverage
- Third-party Liability
- Comprehensive
- Personal Injury Protection
- Full Coverage
- Others
Distribution Channel
- Direct Response
- Agents/Brokers
- Banks
- Others
Application
- Personal Vehicles
- Commercial Vehicles
Vehicle Type
- Light Motor Vehicles
- Passenger Cars
- Light Commercial Vehicles
- Heavy Commercial Vehicles
Region
- Asia Pacific
- North America
- Latin America
- Europe
- Middle East & Africa
Key Players
- Admiral Group Plc
- Allianz
- Allstate Insurance Company
- Assicurazioni Generali S.p.A.
- Bajaj Allianz General Insurance Co. Ltd.
- GEICO
- HDFC ERGO General Insurance Company Limited
- ICICI Lombard General Insurance Company Limited
- Ping An Insurance (Group) Company of China, Ltd.
- State Farm Mutual Automobile Insurance Company
- Tata AIG General Insurance Company Limited
- The New India Assurance Co. Ltd.
Competitive Landscape
Players competing in the global auto insurance market are Admiral Group Plc; Allianz; Allstate Insurance Company; Assicurazioni Generali S.p.A.; Bajaj Allianz General Insurance Co. Ltd.; GEICO; HDFC ERGO General Insurance Company Limited; ICICI Lombard General Insurance Company Limited; Ping An Insurance (Group) Company of China, Ltd.; State Farm Mutual Automobile Insurance Company; Tata AIG General Insurance Company Limited; and The New India Assurance Co. Ltd.
These companies adopt strategies including partnerships, mergers, collaboration, acquisitions, product launches, and capacity expansion to expand their consumer base globally. For instance,
- On July 7, 2021, Bajaj Allianz General Insurance Co. Ltd. and Bank of India entered into an agreement for strengthening the distribution network of Bajaj Allianz General Insurance in urban and remote areas of the country. As a part of the agreement, Bajaj Allianz provides personal lines of products including motor insurance, health insurance, travel insurance, home insurance, engineering insurance, and marine insurance to the bank’s customers.
Request For Customization
Enquiry Before Buying
Speak With Analyst
