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Automobile Insurance Market

Automobile Insurance Market Share & Size Analysis, By Insurance Type (Own Damage, Third Party), By Vehicle Type (Commercial Vehicles, Private Vehicles), By Distribution Channel (Individual Agents, Brokers, Banks, Direct), & Region- Global Market Insights 2022 to 2032

Automobile Insurance Market Outlook (2022-2032)

The global automobile insurance market stands at a valuation of US$ 817 billion in 2022 and is predicted to progress rapidly at a CAGR of 7.1% to climb to US$ 1,616.2 billion by the end of 2032.

The premium paid for automobile insurance is close to 15% of the total insurance premium paid worldwide in 2022. Over the span of the next ten years, auto insurance premium share in all insurance is likely to surpass 20%, representing high traction for the segment.

The fate of the automobile insurance industry is solely dependent on the overall automobile industry. Any changes in the automobile industry can have an impact on the performance of the motor insurance industry. The automobile industry has been on a spree of technological advancements in the last few years. From fully manual cars to fully automatic cars and ultimately to autonomous/driverless vehicles, we have come a long way in terms of technological advancements.

All these changes have an impact on the premiums paid by car owners to insurance companies. Automobile insurance companies are coming up with different kinds of customized insurance policies to acquire a new set of customers. Insurance policies such as shared motor insurance, which applies to customers who use shared cab services such as Uber, are active until the ride ends. The impact of the COVID-19 crisis is still quite visible in the auto insurance industry. Shortages in the supply of vehicles, long waiting periods, and the emergence of shared cab services have affected the motor insurance industry.

The revolution in the autonomous car industry has made the insurance industry ponder about the future of vehicle insurance. Driverless cars and decreasing accident rates will have an impact on the overall business of motor insurance companies. In the next 10 years, the picture will be clearer about the acceptance rate of autonomous cars. Driverless cars with an abundance of data due to connected motors will certainly affect the insurance industry in some way or another.

Report Attributes

Details

Automobile insurance market Size (2021A)

US$ 760 Billion

Estimated Market Value (2022E)

US$ 813.9 Billion

Forecasted Market Value (2032F)

US$ 1616.2 Billion

Global Market Growth Rate (2022-2032)

7.1% CAGR

North America Market Share (2021)

~38%

East Asia Market Growth Rate (2022-2032)

~8.1% CAGR

United States Market Growth Rate (2022-2032)

~5.8% CAGR

Key Companies Profiled

  • Allstate Insurance Company
  • American Automobile Association
  • American Family
  • Erie Insurance
  • Farmers Insurance
  • Geico
  • Liberty Mutual Insurance
  • MS&AD Insurance Group Holdings, Inc.
  • Nationwide Mutual Insurance Company
  • Progressive Casualty Insurance Company
  • Sompo Holdings Inc.
  • State Farm Mutual Automobile Insurance Company
  • The Travelers Companies, Inc.
  • Tokio Marine Holdings, Inc.
  • USAA

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Why Will the Automobile Insurance Market Continue to Grow Rapidly?

“Continuously Increasing Demand for Vehicles across Geographies”

The automobile industry is witnessing a significant increase in the demand for all forms of vehicles. In today’s world, be it a car or bike, a vehicle has become a necessity. Every year, a new set of first-time buyers is entering the market, and automobile insurance has become mandatory in almost all economies of the world, which is leading to increased demand for motor insurance.

Countries such as India and China are facing problems such as long waiting periods for the delivery of new cars, which is a good sign for automobile insurance companies. For the year ended 2021, the Indian automobile insurance market did grow at a healthy rate of 8.9%. Increased spending power with improved overall economic conditions is eventually pushing the demand for motor insurance to new heights.

“Adoption of Technology into Service Offerings”

Like every other industry, technology has had a significant impact on the automobile insurance market. Technology has made life easier for insurance buyers, sellers, and brokers.

On the back of the technological revolution, there have been many new entrants in the insurance industry. Several new motor insurance companies are functioning over the Internet. Both life insurance and non-life insurance can be easily bought via online portals. A few companies have also started a feature of initiating insurance claims online.

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What’s Adversely Affecting Motor Insurance Industry Expansion?

“Increasing Adoption of Ride-sharing Services”

The rise of ride-sharing services across the world has affected the automobile industry, leading to lower demand for motor insurance services. Increasing fuel prices has also indirectly impacted the overall demand for insurance services.

The traffic situation across many countries has forced people to opt for shared cab services rather than driving their own vehicles daily. Insurance companies are coming up with new customized and updated offers to lure new consumers/businesses. Automobile insurance companies are teaming up with ride-hailing service providers to offer their customers insurance on a trip basis.

Automobile insurance market size, share, analysis, demand and sales forecast report by Fact.MR

Market share analysis of the global automobile insurance services industry based on region and insurance type. Under insurance type, third-party insurance accounts for a whopping 57% market share in 2022.

Know thy Competitors

Competitive landscape highlights only certain players
Complete list available upon request

Country-wise Insights

U.S. Automobile Insurance Market to Maintain Lead

The U.S. is the largest automobile market in terms of value. The U.S. automobile insurance industry is highly mature owing to the presence of several large enterprises and vast acceptance by end customers. The U.S. motor insurance market is expected to reach a valuation of US$ 275 billion in 2022. The market is expected to grow steadily on the back of increasing vehicle sales and improved spending power of the population.

The U.S. motor industry is facing some sort of challenges from fake insurance claims. Many times there is no way to prove whether an accident or theft is genuine or has been deliberately done just to get money from the insurance company. An increase in the adoption of connected cars will surely reduce the cases of fraudulent claims to some extent because of the abundance of data that will be available through different connected software/technology.

India - Emerging Market for Automobile Insurance Companies

India has been on an evolution spree in terms of technology. Automobiles and their ancillary services have also witnessed the same evolution in the past few years. In the first half of 2022 itself, India sold over 17 million units of vehicles.

With the increased demand for new vehicles along with existing old vehicles, the market opportunity for automobile insurance service providers is also increasing. The Indian automobile insurance market is expected to register a high CAGR of 9.2% over the forecast period.

Different government initiatives have also helped the insurance sector, especially steps such as mandatory motor insurance. Rising adoption of technology by service providers has made the buying and selling of motor insurance easy and has ultimately helped companies cater to more customers.

Category-wise Insights

Third-Party Insurance to See High Demand

There are generally two types of automobile insurance - own damage and third-party insurance. Third-party insurance is mandatory and every car owner has to get this. Third-party insurance covers any damage done by the policyholder to other cars.

Since this is a mandatory policy that everyone has to acquire, it generates the highest revenue for insurance service providers. For the year 2022, out of the total premiums written, 57% was for third-party insurance. In emerging economies, people are still not very much aware of the benefits of having motor insurance; hence, they do not opt for 'own damage' insurance and consider it as an expenditure. As a result, third-party insurance is enjoying a larger share of the automobile insurance space.

Private Vehicles Contribute More to Total Written Premium

Going by volume, the number of private vehicles outnumbers commercial vehicles by a huge margin. As a result, the value contributed by private vehicles to the total premium written is more than double of commercial vehicles’ contribution.

With the continuously increasing population and increased spending power of the middle class, vehicle ownership is increasing at a fast pace and so does the demand for automobile insurance. Most Gen Y and Gen Z own a vehicle for the first time and are very active in opting for the best suitable insurance policies.

The global value of total premiums written by private vehicle owners for the year 2021 was US$ 539.6 billion. The trend is expected to grow over the coming future amid improved economic conditions and the increasing number of middle-class families across the world.

Competitive Landscape

Key automobile insurance market players are Allstate Insurance Company, American Automobile Association, American Family, Erie Insurance, Farmers Insurance, Geico, Liberty Mutual Insurance, MS&AD Insurance Group Holdings, Inc., Nationwide Mutual Insurance Company, Progressive Casualty Insurance Company, Sompo Holdings Inc., State Farm Mutual Automobile Insurance Company, The Travelers Companies, Inc., Tokio Marine Holdings, Inc., and USAA.

The global motor insurance market is highly competitive owing to the presence of several large and small market players. New tech-armed companies are also trying to eat the market share of larger players. Large established companies are trying to maintain their existing market share by expanding their businesses to other regions or by acquiring competing companies.

  • In March 2022, Liberty Mutual Insurance completed the acquisition of State Auto Group, a regional property and casualty insurance holding company. Through this acquisition, Liberty Mutual Insurance added around US$ 2.3 billion worth of premiums.
  • In January 2021, The Allstate Corporation completed the acquisition of National General Holding Corp for US$ 4 billion.

Fact.MR has provided detailed information about the providers of automobile insurance services positioned across regions, revenue growth, and service offering expansion, in the recently published report.

Segmentation of Automobile Insurance Industry Survey

  • By Insurance Types :

    • Own Damage
    • Third Party
  • By Vehicle Type :

    • Commercial Vehicles
    • Private Vehicles
  • By Distribution Channel :

    • Individual Agents
    • Brokers
    • Banks
    • Direct
    • Others (Not Covered Elsewhere)
  • By Region :

    • North America
    • Latin America
    • Europe
    • East Asia
    • South Asia & Oceania
    • Middle East & Africa

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Automobile Insurance Market

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The global automobile insurance market is expected to reach a valuation of US$ 813.9 billion by 2032.

Brokers account for almost 40% of the total market share.

The market in East Asia is forecasted to expand at a CAGR of 8.1% over the next 10 years.

The U.S. automobile insurance industry is valued at US$ 275 billion in 2022.

Revenue from automobile insurance increased at a CAGR of 6.5% during the historical period (2017-2021).

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