The global vehicle insurance market size was valued at USD 852.53 billion in 2023 and it is expected to reach USD 1593.87 billion by 2032 with a CAGR of 7.20% from 2023 to 2032.
The rising demand for the vehicles for transportation across the globe is expected to boost the growth of the global vehicle insurance market. The rising disposable income, improved living standards, growing penetration of various vehicle types and brands, rising affordability of the consumers, and rising economic activities are some of the most prominent factors that are boosting the demand for the vehicles and hence the demand for the vehicle insurance is expected to significantly during the forecast period. The vehicle insurances offer financial protection against any damage to the vehicle or damage to a third party. The rising penetration of the top vehicle insurance providers and rising consumer awareness regarding the benefits of vehicle insurance is boosting the growth of the global vehicle insurance market.
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Moreover, the government mandates over the necessity of vehicle insurances is further boosting the demand for the vehicle insurances. The rising popularity of the online insurance aggregators is positively contributing towards the growth of the global vehicle insurance market. Furthermore, the rising government initiatives to promote the adoption of the latest electric vehicles is augmenting the demand for the EVs across the globe, which is expected to be one of the most important drivers of the vehicle insurance market during the forecast period.
Report Highlights
Regional Snapshot
North America was the leading vehicle insurance market in 2021. The high demand for vehicles among the consumers owing to the improved living standards, higher affordability, and high demand for luxurious products is a major factor behind the increased demands for the vehicle insurance. The rising sales of the electric vehicles is expected to foster the demand for the vehicle insurance policies during the forecast period. The presence of several top insurance providers in the region has great contributions in the growth of the market. The growing adoption of online channels for buying vehicle insurances is boosting the growth of the North America vehicle insurance market.
Asia Pacific is expected to witness the highest CAGR during the forecast period. The demand for the vehicle insurance is expected to rise owing to the rising cases of road traffic accidents. According to the World Health Organization, about 93% of the road accidents occur in low and middle income countries. The huge demand for the electric vehicles in China and the regulatory mandates of having vehicle insurance in India are the most prominent drivers of the Asia Pacific vehicle insurance market.
| Report Coverage | Details |
| Growth Rate from 2023 to 2032 | CAGR of 7.20% |
| Market Size in 2023 | USD 852.53 Billion |
| Market Size by 2032 | USD 1593.87 Billion |
| Largest Market | North America |
| Fastest Growing Region | Asia Pacific |
| Base Year | 2022 |
| Forecast Period | 2023 to 2032 |
| Segments Covered | Coverage, Application, Distribution Channel, Vehicle Type, Geography |
Driver
Growing demand for the electric vehicles
The rising concerns over greenhouse gas, climate change, and controlling carbon footprint has forced the government to encourage the adoption of the eco-friendlier transport solutions across the globe. The rising consumer awareness regarding the benefits of electric vehicles on the environment is boosting the demand for the electric vehicles, which is expected to bolster the demand for the vehicle insurance during the forecast period. Countries like Canada, Thailand, Japan, and India are offering subsidies to the consumers for buying EVs.
Restraint
Low penetration of vehicle insurance
There is a very low penetration of vehicle insurance policies in several developing economies. Accordingto the Insurance Information Bureau (IIB), around 6.5 to 7 crore vehicles have insurance coverage against 18 crore registered vehicles in India. Therefore, the low adoption of vehicle insurance is expected to restrain the market growth during the forecast period.
Opportunity
Growing adoption of online channels to buy insurance
With the advent of the digital technologies, the emergence of online insurance aggregators like Policybazaar has gained a rapid traction among the consumers. The online channels are a popular medium of buying and renewing vehicle insurance policies in the developed economies and it is an emerging trend in the developing economies. This is expected to offer lucrative growth opportunities to the market players in the forthcoming future.
Challenge
Hassles in settlement of policies
The consumers sometimes faces difficulties while claiming insurance policies. The complex procedures and delays in the process due to improper settlement policies are the major challenges for the market players that restricts the consumers to opt for the vehicle insurance policies.
Read Also: Bicycle Market Size to Surpass Around US$ 180 Billion by 2030
Recent Developments
Segments Covered in the Report
By Coverage
By Application
By Distribution Channel
By Vehicle Type
By Geography
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