Usage-based Insurance - Global Strategic Business Report

The global market for Usage-based Insurance was valued at USD 42.3 Billion in 2024 and is projected to reach USD 162.3 Billion by 2030, growing at a CAGR of 25.1% from 2024 to 2030. This comprehensive report provides an in-depth analysis of market trends, drivers, and forecasts, helping you make informed business decisions.

Global Usage-Based Insurance Market - Key Trends & Drivers Summarized

What Is Usage-Based Insurance and How Does It Work?

Usage-based insurance (UBI) is a type of vehicle insurance that calculates premiums based on the actual usage and driving behavior of the policyholder. Unlike traditional insurance models that rely on static factors like age, gender, and location, UBI leverages telematics technology to monitor real-time data, such as mileage, speed, braking patterns, and time of day when driving. This data is then used to assess the risk profile of the driver more accurately, leading to a personalized insurance premium that reflects the individual's driving habits. UBI programs typically use devices installed in the vehicle, smartphone apps, or built-in vehicle telematics systems to collect data. This approach not only encourages safer driving behaviors but also offers the potential for cost savings to consumers who drive less or exhibit low-risk driving patterns.

How Has Technology Enabled the Growth of Usage-Based Insurance?

The rapid advancement of telematics technology and data analytics has been a key enabler of the usage-based insurance market. Telematics devices and mobile apps can now collect and transmit vast amounts of data with high precision, allowing insurers to create more accurate and individualized risk assessments. The integration of GPS and accelerometer technologies within telematics systems helps in tracking various aspects of driving, including speed, acceleration, and harsh braking, which are critical factors in determining insurance risk. Additionally, advancements in big data analytics and machine learning algorithms enable insurers to process and analyze this data in real-time, offering dynamic pricing models that adjust premiums based on recent driving behavior. These technological advancements have made UBI more accessible and attractive to both insurers and consumers.

Where Is Usage-Based Insurance Gaining Traction?

Usage-based insurance is gaining significant traction in various markets around the world, particularly in regions with high vehicle insurance costs and a tech-savvy consumer base. North America, particularly the United States, has been a leader in adopting UBI, driven by the widespread use of telematics and a consumer preference for personalized products. Europe is also seeing a growing adoption of UBI, especially in countries like Italy and the UK, where insurance costs are high, and there is a strong regulatory push towards safer driving practices. Emerging markets in Asia and Latin America are beginning to explore UBI as well, driven by the increasing penetration of smartphones and the growing demand for cost-effective insurance solutions. Fleet management companies and commercial vehicle operators are also significant adopters of UBI, as it allows them to reduce insurance costs and monitor driver behavior across their fleets.

What Is Driving the Growth of the Usage-Based Insurance Market?

The growth in the usage-based insurance market is driven by several factors, including technological advancements, changing consumer preferences, and regulatory support. The increasing availability of affordable telematics devices and the widespread adoption of smartphones have made UBI more accessible to a broader audience. Consumers are increasingly seeking personalized products that offer cost savings and align with their individual needs, which UBI provides. Regulatory bodies in various regions are also encouraging the adoption of UBI as a way to promote safer driving behaviors and reduce road accidents. Additionally, the rising costs of traditional vehicle insurance are prompting consumers to seek alternative options like UBI, which can offer significant savings for low-mileage and safe drivers. The growing emphasis on sustainability and reducing carbon emissions is another factor, as UBI incentivizes reduced driving and more responsible vehicle use.

Report Scope

The report analyzes the Usage-based Insurance market, presented in terms of market value (USD Thousand). The analysis covers the key segments and geographic regions outlined below.

Segments

Package (Pay-As-You-Drive (PAYD), Pay-How-You-Drive (PHYD), Manage-How-You-Drive (MHYD)); Technology (Black Box, OBD-II, Smartphones, Embedded Systems, Other Technologies).

Geographic Regions/Countries

World; United States; Canada; Japan; China; Europe (France; Germany; Italy; United Kingdom; and Rest of Europe); Asia-Pacific; Rest of World.

Key Insights:

• Market Growth: Understand the significant growth trajectory of the Pay-As-You-Drive (PAYD) Package segment, which is expected to reach $84 Billion by 2030 with a CAGR of a 27.5%. The Pay-How-You-Drive (PHYD) Package segment is also set to grow at 24.4% CAGR over the analysis period.
• Regional Analysis: Gain insights into the U.S. market, valued at $12 Billion in 2024, and China, forecasted to grow at an impressive 23.6% CAGR to reach $23.8 Billion by 2030. Discover growth trends in other key regions, including Japan, Canada, Germany, and the Asia-Pacific.

Report Features:

• Comprehensive Market Data: Independent analysis of annual sales and market forecasts in USD from 2024 to 2030.
• In-Depth Regional Analysis: Detailed insights into key markets, including the U.S., China, Japan, Canada, Europe, Asia-Pacific, Latin America, Middle East, and Africa.
• Company Profiles: Coverage of major players such as Allianz SE, Allstate Insurance Company, Cambridge Mobile Telematics, Inseego Corporation, insurethebox and more.
• Complimentary Updates: Receive free report updates for one year to keep you informed of the latest market developments.

Why You Should Buy This Report:

• Detailed Market Analysis: Access a thorough analysis of the Global Usage-based Insurance Market, covering all major geographic regions and market segments.
• Competitive Insights: Get an overview of the competitive landscape, including the market presence of major players across different geographies.
• Future Trends and Drivers: Understand the key trends and drivers shaping the future of the Global Usage-based Insurance Market.
• Actionable Insights: Benefit from actionable insights that can help you identify new revenue opportunities and make strategic business decisions.

Key Questions Answered:

• How is the Global Usage-based Insurance Market expected to evolve by 2030?
• What are the main drivers and restraints affecting the market?
• Which market segments will grow the most over the forecast period?
• How will market shares for different regions and segments change by 2030?
• Who are the leading players in the market, and what are their prospects?

Some of the 11 major companies featured in this Usage-based Insurance market report include:

• Allianz SE
• Allstate Insurance Company
• Cambridge Mobile Telematics
• Inseego Corporation
• insurethebox
• Intelligent Mechatronic Systems, Inc.
• Liberty Mutual Insurance
• Mapfre
• Modus Group
• Octo Telematics Ltd.
• Progressive Corporation
• Sierra Wireless, Inc.
• The Floow Ltd.
• TomTom International BV
• TrueMotion
• Unipolsai Assicurazioni S.P.A.
• Verizon Enterprise Solutions
• Vodafone Group PLC