Usage-based Insurance Market Analysis and Forecast to 2027 by Recent Trends, Development and Regional Growth Overview

By Ronak Bora

Global usage-based insurance market is projected to witness heavy gains in the forecast timespan owing to the steady uptake of UBI platforms across the insurance sector. Through these platforms, insurance companies aim to align insurance premiums and accurately track driving patterns with estimated risks.
Increasing collaborations between solution providers and insurance companies would likely be a key factor pushing market growth. From these partnerships, insurance firms are focusing on using embedded telematics solution to grow their profitability.
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In addition, insurance companies are also collaborating with software firms to provide smartphone-based telematics insurance programs to customers and set themselves apart from the competition. Citing an instance, in August 2018, NJM Insurance Group collaborated with IMS for a new smartphone-based telematics program. NJM leverages the smartphone telematics of IMS to promote customer safety by offering rewards to safe drivers through a driver scoring system.  
It is estimated to grow at an impressive CAGR of 35% between 2019-2026. Ease of use and rapid proliferation of smartphones across the world would likely add up to the segment growth. Telematics solutions offer various benefits to evaluate the driving style of customers and then making necessary modifications to decrease high premiums.
APAC usage-based insurance market is anticipated to observe heavy gains and grow at a CAGR of 26% through 2026. Increasing the usage of telematic technologies by insurance providers in the region would outline the overall market outlook.
With respect to safety concerns and cost efficiency, the PHYD (Pay-How-You-Drive) insurance package is projected to witness lucrative growth through 2026. The segment held a market share of more than 70% in 2018 and is projected to dominate the usage-based insurance market in the coming years.
The growing popularity of PHYD in consumers for reducing insurance premiums would propel the segment growth. Earlier, insurance models were based on the driving history of the driver. However, PHYD insurance focuses on current driving behavior to reduce insurance premiums. In fact, customers are utilizing the PHYD policy to decrease careless driving and implementing safe driving methods to earn incentives and rewards. 
Elaborating further on PHYD segment, the policy is also beneficial for insurance providers. This policy helps in reducing unanticipated accident risks, fraudulent cases, and lower insurance claims. Furthermore, merging of services like theft insurance programs and vehicle wellness reports with PHYD packages would further drive the usage-based insurance market growth.
All in all, the above-mentioned determinants would offer a wide range of opportunities for usage-based insurance market players in coming years. The competitive landscape of global user-based insurance market includes players like Generali, Octo, Progressive, UnipolSai, Desjardins Group, Nationwide, AXA, Sierra Wireless, Allstate, State Farm, Liberty Mutual, and Allianz among others.
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Partial Chapter of the Table of Content
Chapter 5   Usage-based Insurance Market, By Package
5.1    Key trends, by package
5.2    PHYD
5.2.1    PHYD market estimates and forecast, 2016- 2027
5.3    PAYD
5.3.1    PAYD market estimates and forecast, 2016- 2027
5.3.2    Device-based
5.3.2.1.1    Device-based market estimates and forecast, 2016- 2027
5.3.3    Telematics-based
5.3.3.1.1    Telematics-based market estimates and forecast, 2016- 2027
Chapter 6   Usage-based Insurance Market, By Technology
6.1    Key trends, by technology
6.2    OBD-II
6.2.1    OBD-II market estimates and forecast, 2016- 2027
6.3    Smartphone
6.3.1    Smartphone market estimates and forecast, 2016- 2027
6.4    Black Box
6.4.1    Black Box market estimates and forecast, 2016- 2027
6.5    Embedded telematics
6.5.1    Embedded telematics market estimates and forecast, 2016- 2027
Chapter 7   Usage-based Insurance Market, By Vehicle Type
7.1    Key trends, by vehicle type
7.2    Passenger vehicle
7.2.1    Market estimates and forecast, 2016- 2027
7.2.2    Market estimates & forecast, by technology, 2016- 2027
7.3    Commercial vehicle
7.3.1    Market estimates and forecast, 2016- 2027
7.3.2    Market estimates & forecast, by technology, 2016- 2027
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About Author

Ronak Bora

A graduate in Electronics Engineering, Ronak writes for Technology Magazine and carries a rich experience in digital marketing, exploring how the online world works from a technical and marketing perspective. His other areas of interest include reading, music, and sport....

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