The North America usage-based insurance market is projected to hold a majority UBI industry share of over 35% by 2024 led by growth in the number of connected cars with inbuilt telematics solutions and the adoption of the cloud-based telematics solutions
Selbyville, Delaware (Dec. 17, 2018) – The global usage-based insurance (UBI) market is expected to grow from its current value of USD 34 billion to more than USD 107 billion by 2024, according to a new research report by Global Market Insights, Inc.
One of the major factors driving the market growth is an increase in the production of passenger & commercial vehicles that is embedded with telematics or the use of external tracking systems to capture data about the vehicle’s health & the driving behaviour. Car makers and the insurance companies then use telematics data for calculating the insurance premium for clients in accordance with the usage rate of the vehicle. The insurance telematics enables customers to lessen their premium rates by adopting safe driving.
Other factors augmenting the usage-based insurance market growth are the increasing penetration of smartphones with capabilities to connect to the onboard devices and the increase in the number of connected cars, enabling vehicles to share data with the outside environment. The widespread adoption of the in-car technologies will influence the consumers’ attitude toward UBI as they are willing to share their driving information for personalized insurance quotes.
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The PHYD segment held a dominant share of over 70% of the usage-based insurance market in 2017 as this telematics-driven insurance model takes into consideration how a person drive. The insurance companies can assess the driving skills by installing telematics devices in the car to record the driving habits. PHYD analyses the habits based on several parameters such as speeding, braking, positioning, and parking to decide premiums. This helps in addressing the unfair practices of motor insurance and considers the factors to ensure that car owners are charged fair premiums.
The OBD II technology held a major share of over 48% in the usage-based insurance market in 2017 and is expected to dominate the market with a share of around xx% in 2024. Vehicles equipped with telematics devices allow insurance companies to get a more precise information to rate a driver’s premium. The traditional UBI programs use OBD II, which allows car owners to manage and remove engine malfunctions and improve vehicle reliability while reducing the fleet operations cost. By implementing OBD II fleet management telematics systems, which track driver performance and allow vehicle utilization, the companies can reduce their fleet insurance premiums.
The commercial vehicles segment in the usage-based insurance (UBI) market is projected to register an excellent growth rate of over 18% from 2018 to 2024. The commercial vehicles segment is widely deploying telematics solutions to analyse vehicle and driver data to assess the risks and restore profit margins. These solutions are used in commercial fleets to help in integrating capabilities such as traffic updates, roadside assistance, and smart routing and tracking. Telematics insurance data is used by the insurers to review driving behaviour and promote safe driving through insurance incentives. The technology is playing a key role in commercial logistics and supply chains as it helps in addressing the challenges related to driver monitoring, insurance, and safety.
Browse key industry insights spread across 270 pages with 324 market data tables & 29 figures & charts from the report, Usage-based Insurance (UBI) Market Size By Package, By Vehicle, Industry Analysis Report, Regional Outlook, Growth Potential, Competitive Market Share & Forecast, 2018 – 2024 in detail along with the table of contents at Usage-based Insurance Market Share 2018-2024 UBI Industry Report. The market is described By Package (Pay-How-You-Drive (PHYD), Pay-As-You-Drive (PAYD) [Device-based, Telematics-based], By Technology (OBD-II, Smartphone, Blackbox, Embedded Telematics), By Vehicle (Passenger Vehicle, Commercial Vehicle), Industry Analysis Report, Regional Outlook (U.S., Canada, UK, Germany, France, Italy, Spain, Austria, Netherlands, China, Australia, Southeast Asia, Japan, India, South Africa, Brazil, Mexico, Colombia, Saudi Arabia, UAE, Qatar), Growth Potential, and Competitive Market Share & Forecast, 2018 – 2024.
The North America usage-based insurance market is projected to hold a majority market share of over 35% by 2024. The market growth is attributed to the factors such as the growth in the number of connected cars with inbuilt telematics solutions and the adoption of the cloud-based telematics solutions. The region is dominated by the presence of various car insurance companies that are using black box technology to track driving habits. The telematics-based black box devices provide detailed information to car insurance companies and let them calculate insurance risk levels more accurately.
The insurance companies operating in the usage-based insurance market are entering into strategic partnerships with automakers and other car insurance service providers to jointly offer new insurance telematics solutions to the customers. For instance, in September 2016, Generali and Progressive collaborated to develop a new generation of customized car telematics solutions, which reward safe drivers based on their driving patterns. These solutions also help the companies to improve their individual data capabilities and boost product offerings. The insurance companies are adopting product differentiation strategies and introducing new UBI products and services to stay ahead of their competitors.
Some of the major players of the operating in the usage-based insurance (UBI) market are Progressive, Allstate, State Farm, AXA, Allianz, Liberty Mutual, Nationwide, Vodafone Automotive, UnipolSai, Generali, Octo, Metromile, TomTom, Insure The Box, Mapfre S.A, Zubie, Desjardins Group, Sierra Wireless, IMS, Cambridge Mobile Telematics, and Danlaw.
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Global Market Insights, Inc., headquartered in Delaware, U.S., is a global market research and consulting service provider; offering syndicated and custom research reports along with growth consulting services. Our business intelligence and industry research reports offer clients with penetrative insights and actionable market data specially designed and presented to aid strategic decision making. These exhaustive reports are designed via a proprietary research methodology and are available for key industries such as chemicals, advanced materials, technology, renewable energy and biotechnology.
SOURCE: Global Market Insights, Inc.Tags: Usage-Based Insurance (UBI)