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Usage Insurance Market

Usage Insurance Market

Constraints of Conventional Automotive Insurance to Boost the Growth of Usage Insurance Market during 2021-2031

Usage Insurance Market
  • Aug-2021
  • List of Tables : 57
  • List of Figures : 92
  • 170 Pages
  • Automotive

Market Snapshot

Newly released data from Fact.MR market Analysis shows that global demand of the overall Usage Insurance market accounted for almost US$ 30 Bn in 2020 and is projected to reach nearly US$ 150 Bn by 2031, expanding 5x across the 2021-2031 forecast period.

Growing complexities in the one-size-fits-all approach associated with general automotive insurance is prompting increased uptake of usage based insurance, which are far more dynamic and accurate in nature. Demand for black box usage insurance is expected to remain most prominent, amid wider connectivity and higher accuracy.

Key Points Addressed in Usage Insurance Industry Analysis

  • Market Estimates and Forecasts (2016-2031)
  • Key Drivers and Restraints Shaping Market Growth
  • Segment-wise, Country-wise, and Region-wise Analysis
  • Competition Mapping and Benchmarking
  •  Brand Share and Market Share Analysis
  • Key Product Innovations and Regulatory Climate
  • COVID-19 Impact on Usage Insurance and How to Navigate
  • Recommendation on Key Winning Strategies

Know More Details About the Report

Usage Insurance Consumption Analysis 2016-2020 vs Market Outlook 2021 to 2031

According to Fact.MR- market research and competitive intelligence provider, the global usage insurance industry grew to a value of approximately US$ 30 Bn by 2020. As conventional automotive insurance experiences significant constraints, vehicle owners are increasingly relying on usage-based insurance to optimize costs.

During the COVID-19 pandemic, the global automotive industry experienced a major downswing, attributed to disruptions in the supply chain attributed to the imposition of stringent lockdowns. This led to a drop in usage insurance services sales in the short-term. However, demand remained sustained amidst the increasing popularity of electric vehicles.

A growing trend in automobile insurance is the collection of data about how far individual vehicles have been driven based on the data collected by a particular insurer. Telematics is used in insurance and can either be pre-installed in the vehicle or can be added with a plug-in device. Based on these trends, Fact.MR expects that the global market will surge at a CAGR of over 17% from 2021 to 2031.

How are Good Driving Practices Paving Way for Usage Insurance?

Incentives for better driving habits will increase drivers' motivation to improve their driving behavior. It leads to fewer traffic violations and accidents, resulting in fewer claims for insurance companies. This could prevent most drivers from paying more in rates and thus save them some money.

Implementation of tools for tracking drivers' driving behavior through the use of telematics is acquiring significant traction. The adoption of various technologies, including odometers, smartphones, and OBD dongles, has profoundly affected the driving behavior of consumers.

The coverage provided by usage-based insurance can offer current and ongoing details about driving habits, enabling appropriate calculation of rates and discounts quickly. The maximum discount offered is 25 percent, but most drivers receive a five to ten percent discount after recording driving.

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How is Artificial Intelligence Paving Way for Implementing Advanced Usage Insurance Services?

With artificial intelligence, insurance tech companies are conquering new grounds in the digital age. Various industries, including the insurance industry, have been affected by the rise of artificial intelligence. With the help of machine learning, data modeling, and predictive analysis, insurers enhanced bottom lines and improved customer service by applying artificial intelligence across the entire insurance chain.

Unceasing research on digitization of usage-based insurance is leading to the increased demand for sensors, including wearable devices, vehicle sensors, and smart apps used in mobile calls for new insurance services to complement new vehicles.

Country-wise Insights

Why is the U.S an Emerging Hub for Usage Insurance?

According to Fact.MR, usage insurance adoption is likely to be the highest in the U.S, accounting for over 50% of global demand. The nation is moving towards the adoption of usage-based insurance in new and existing vehicles equipped with telematics technology as a result of the higher adoption of vehicles.

As per the National Association of Insurance Commissioners (NAIC), the common feature of new vehicles purchased is in-built telematics. As part of the new insurance regulations, auto insurers must also use telematics for all their vehicles. In addition, many companies provide usage-based insurance with the purchase of each car, which also contributes to market growth.

How Usage Insurance is affecting the European Markets?

It is anticipated that Europe will hold a significant share of the market for UBI. There is a significant rise in the environment due to the increasing number of connected cars with integrated telematics. Embedded systems are more prevalent because of their higher adoption rate.

According to projections put forward by Fact.MR, demand for usage insurance across Europe is anticipated to soar at an impressive 10% CAGR until 2031, with Germany, France and the U.K expected to take the lead across the forecast period.

How will the Asian Market Perform in Forthcoming Years?

Asia is expected to register a growth rate of nearly 15% between 2021 and 2031. The region holds a large share of the automotive telematics market owing to the region's increasing demand.

A key factor driving the growth of the market is the increasing adoption of smartphones and telematics products in major countries, including India and China. Increasing adoption of telematics and IoT is expected to drive market growth in Japan, China, India, and South Korea. UBI solutions are predicted to be in demand in the region as governments ramp up initiatives to improve vehicle safety.

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Category-wise Insights

Which Policy Type Dominates the Market for Usage Insurance?

Pay-as-you-drive auto insurance is expected to remain strong, with an expected share of over 55% across the 2021-2031 assessment period. Benefits such as lower car insurance premiums, customized coverage, free telematics installation and floater coverage for multiple cars is increasing its popularity.

In addition, the policy encourages safe driving since customers are charged more when they don't drive well. In comparison with other types of car insurance, this policy is more affordable.

How is Smartphone-based Usage Insurance Gaining Ground?

A smartphone or any other device can track this information for the purpose of bettering the chances of getting better discounts offered by the insurance companies by using their driving patterns. Sensors on smartphones are used to collect vehicle data to calculate insurance discounts. Insurance companies can significantly reduce risks and better serve policyholders by integrating embedded telematics and smartphone integration into their vehicles.

Smartphone apps have enabled millennials to find out their driving safety or determine their score, and to share it on social media to gain popularity. With an increased demand for telematics technology installed in vehicles and smartphones being the main method of knowing the score, usage-based insurance is growing. A CAGR of 9% is projected for this segment.

Competitive Landscape

Major players with a prominent share in the market are focusing on expanding their customer base.

  • Earnix, a global provider of advanced rating, pricing, and product personalization solutions for insurers and banks announced its acquisition of AI-Powered telematics provider Driveway Software Corporation’s assets. It will be joined by Driveways’ strong and highly capable team of domain-rich experts.
  • On June 16, 2020, USAA is expected to acquire Noblr, a digital insurer offering behavior-based auto insurance. Dedicated to military personnel and their families, the company says its acquisition will help make it more competitive by upgrading its services. Financial strength was also cited as a factor as to why the company could acquire companies in this space and accelerate innovation.

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Report Scope



Market size value in 2020

USD 30 Billion

Market forecast value in 2031

USD 150 Billion

Growth Rate

CAGR of 17% from 2021 to 2031

Forecast Period


Historical Data Available for


Market Analysis

US$ Mn for value &  ‘000 units for volume

Key Regions Covered

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia
  • Oceania
  • MEA

Key Countries Covered

  • U.S.
  • Canada
  • Germany
  • U.K.
  • France
  • Spain
  • Italy
  • Russia
  • China
  • Japan
  • South Korea
  • India
  • Australia
  • Brazil
  • Mexico
  • Argentina
  • GCC
  • South Africa

Key Market Segments Covered

  • Policy Type
  • Product
  • Vehicle
  • Region

Key Companies Profiled

  • Insure the Box Limited
  • Allstate Insurance Company
  • State Farm
  • Uniqa Insurance Group AG
  • Groupama
  • Generali Group
  • UnipolSai Assicurazioni S.p.A
  • Liberty Mutual Group
  • Allianz SE
  • Progressive Corporation


Available upon Request

Key Segments Covered

  • Policy Type

    • Pay-how-you-drive(PHYD)
    • Pay-as-you-drive(PAYD)
    • Manage-how-you-drive(MHYD)
  • Product

    • Black Box
    • OBD Dongle
    • Smartphone
    • Others
  • Vehicle

    • Passenger Vehicle
    • Commercial Vehicle

Usage Insurance Market- Scope of Report

A recent study by Fact.MR on the usage insurance market offers a 10-year forecast for 2021 to 2031. The study analyzes crucial trends that are currently determining the growth of the market. This report explicates on vital dynamics, such as the drivers, restraints, and opportunities for key market players along with key stakeholders as well as emerging players associated with offering usage insurance.

The study also provides the dynamics responsible for influencing the future status of the usage insurance market over the forecast period. A detailed assessment of value chain analysis, business execution, and supply chain analysis across regional markets has been covered in the report.

A list of prominent companies operating in the usage insurance market, along with their product portfolios, enhances the reliability of this comprehensive research study.

Report Summary

The study offers comprehensive analysis on diverse features, including production capacities, demand, product developments, revenue generation, and sales of usage insurance services across the globe.

A comprehensive estimate on the market has been provided through an optimistic as well as a conservative scenario, taking into account the sales of usage insurance services during the forecast period. Price point comparison by region with global average price is also considered in the study.

Key Questions Answered in Report

  • Which are the most lucrative usage insurance markets?
  • Which factors will impact the growth of usage insurance?
  • How will changing trends impact the strategies of market players?
  • How can market players capture the low-hanging opportunities across regions?
  • Which companies are leading the usage insurance industry?
  • What are the winning strategies of stakeholders in the market?

Analysis on Market Size Evaluation

The market has been analyzed for each segment in terms of volume (‘000 Units) and value (US$ Mn).

Estimates at global and regional levels for usage insurance are available in terms of “US$ Mn” for value and in “‘000 Units” for volume. A Y-o-Y growth contrast on prominent market segments, along with market attractiveness evaluation, has been incorporated in the report. Furthermore, absolute dollar opportunity analysis of all the segments adds prominence to the report.

Absolute dollar opportunity plays a crucial role in assessing the level of opportunity that a manufacturer/distributor can look to achieve, along with identifying potential resources, considering the sales and distribution perspective in the global usage insurance market.

Inspected Assessment on Regional Segments

Key sections have been elaborated in the report, which have helped deliver projections on regional markets. These chapters include regional macros (political, economic, and business environment outlook), which are expected to have a momentous influence on the growth of the usage insurance market during the forecast period.

Country-specific valuation on demand for usage insurance has been offered for each region, along with market scope estimates and forecasts, price index, and impact analysis of the dynamics of prominence in regions and countries. For all regional markets, Y-o-Y growth estimates have also been incorporated in the report.

Detailed breakup in terms of value & volume for emerging countries has also been included in the report.

In-depth Analysis on Competition Analysis

The report sheds light on leading providers of usage insurance, along with their detailed profiles. Essential and up-to-date data related to market performers who are principally engaged in offering usage insurance has been brought with the help of a detailed dashboard view. Market share analysis and comparison of prominent players provided in the report permits report readers to take preemptive steps in advancing their businesses.

Company profiles have been included in the report, which include essentials such as product portfolios and key strategies, along with all-inclusive SWOT analysis on each player. Company presence is mapped and presented through a matrix for all the prominent players, thus providing readers with actionable insights, which helps in thoughtfully presenting the market status, and predicting the competition level in the usage insurance domain. Prominent companies operating in this space include Insure the Box Limited, Allstate Insurance Company, State Farm, Uniqa Insurance Group AG, Groupama, Generali Group, UnipolSai Assicurazioni S.p.A, Liberty Mutual Group, Allianz SE and Progressive Corporation among others.

Research Methodology

In Fact.MR’s study, a unique research methodology is utilized to conduct extensive research on the growth of the usage insurance industry, and reach conclusions on the future growth parameters. This research methodology is a combination of primary and secondary research, which helps analysts ensure the accuracy and reliability of the drawn conclusions.

Secondary resources referred to by analysts during the preparation of the market study include statistics from governmental organizations, trade journals, white papers, and internal and external proprietary databases. Analysts have interviewed senior managers, product portfolio managers, CEOs, VPs, marketing/product managers, and market intelligence managers, all of whom have contributed to the development of the research report as a primary resource.

- FAQs -

As of 2020, value of the usage insurance market amounted to nearly US$ 30 Bn as per Fact.MR

From 2016 to 2020, the global market for usage insurance surged at around 10% CAGR

By 2031, Fact.MR projects the usage insurance industry to be valued at US$ 150 Bn

From 2021 to 2031, the global market for usage insurance is poised to expand 5x

Rising complexities regarding the one-size-fits-all approach of conventional vehicle insurance and rapid digitization is spurring usage insurance popularity

Nearly 50% of global usage insurance coverage is likely to occur across the U.S market

According to Fact.MR, usage insurance demand in Europe will likely surge at a CAGR of 10%

The Asian market for usage insurance is expected to surge at around 15% CAGR until 2031

Pay-as-you-drive (PAYD) usage insurance will remain most sought after, capturing 55% of the market

Allianz SE, Allstate Corporation, Aviva, AXA, and Insurethebox are the top five global insurers.

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Is the market research conducted by Fact.MR?

Yes, the report has been compiled by expert analysts of Fact.MR, through a combination of primary and secondary research. To know more about how the research was conducted, you can speak to a research analyst.

What research methodology is followed by Fact.MR?

Fact.MR follows a methodology that encompasses the demand-side assessment of the market, and triangulates the same through a supply-side analysis. This methodology is based on the use of standard market structure, methods, and definitions.

What are the sources of secondary research?

Fact.MR conducts extensive secondary research through proprietary databases, paid databases, and information available in the public domain. We refer to industry associations, company press releases, annual reports, investor presentations, and research papers. More information about desk research is available upon request.

Who are the respondents for primary research?

Fact.MR speaks to stakeholders across the spectrum, including C-level executives, distributors, product manufacturers, and industry experts. For a full list of primary respondents, please reach out to us.

Is a sample of this report available for evaluation?

Yes, you can request a sample, and it will be sent to you through an email.