Motor Insurance Market Report 2025

The motor insurance market size has grown strongly in recent years. It will grow from $877.75 billion in 2024 to $960.69 billion in 2025 at a compound annual growth rate (CAGR) of 9.4%. The growth in the historic period can be attributed to vehicle ownership growth, regulatory mandates, urbanization and traffic density, risk mitigation and financial security, lending and financing requirements.

The motor insurance market size is expected to see strong growth in the next few years. It will grow to $1.39 trillion in 2029 at a compound annual growth rate (CAGR) of 9.7%. The growth in the forecast period can be attributed to technological integration in telematics, emergence of electric and autonomous vehicles, focus on environmental sustainability, data analytics and predictive modeling, shift towards on-demand and usage-based insurance. Major trends in the forecast period include focus on environmental sustainability, integration of biometric authentication for policy management, personalized premiums based on behavioral data, regulatory compliance and insurtech innovations, customer-centric service models.

The increase in the number of automobiles on the road is expected to drive the growth of the motor insurance market in the coming years. Automobiles, including cars, buses, and trucks, are self-propelled vehicles used for transporting passengers and goods on land. As more people purchase vehicles, the demand for auto insurance rises, primarily due to the financial protection it offers against various risks. Motor insurance provides benefits such as coverage for injuries, medical expenses, lost wages, vehicle repairs, and damage to property in the event of an accident. For instance, in November 2023, Statistics Canada reported a slight increase in the total number of registered road motor vehicles, reaching 26.3 million in 2022, marking a 0.3% rise from the previous year, equivalent to an additional 78,655 vehicles on the roads. Therefore, the growing number of automobiles is significantly propelling the motor insurance market.

The rise in traffic accidents is expected to drive the growth of the motor insurance market in the future. Traffic accidents refer to collisions or incidents involving vehicles on roads that result in property damage, injuries, or fatalities. These incidents are often caused by factors such as human error, vehicle malfunctions, or adverse road and weather conditions. They are highly relevant to motor insurance, as they lead to insurance claims and coverage needs. Motor insurance provides financial protection for vehicle damage and injuries resulting from traffic accidents, covering expenses such as vehicle repairs, medical bills, and liability costs. For instance, in 2023, the Transport Accident Commission, an Australia-based government agency, reported that 295 people lost their lives on Victorian roads, representing a 22.4% increase (54 more fatalities) compared to 2022. Additionally, there were 261 fatal crashes, up by 22 (9%) from the previous year's total of 239. Therefore, the rise in traffic accidents is significantly driving the growth of the motor insurance market.

The dominant trend in the motor insurance market revolves around technological advancements, with major companies actively integrating advanced solutions into their insurance operations to enhance their market positioning. A case in point is XA Group, a technology company based in Dubai, which introduced Addenda, a digital platform leveraging blockchain technology. Launched in September 2022, Addenda is designed to facilitate the reconciliation of motor vehicle recovery receivables for insurers. XA Group aims to optimize the platform by ensuring it effectively manages crucial touchpoints in the automotive claims value chain, fostering connectivity among insurers, brokers, repairers, and customers. The company's strategy involves integrating existing products into the Addenda platform to further enhance its capabilities. This reflects a broader industry shift toward leveraging technology to streamline processes and improve overall efficiency within the motor insurance sector.

Prominent companies in the motor insurance market are actively innovating by introducing products such as pay-per-mile car insurance, also known as usage-based insurance. This innovative model allows drivers to pay a low monthly base rate along with a per-mile rate for the distance they drive. This approach is specifically tailored to benefit low-mileage drivers, providing a cost-effective alternative for individuals who don't use their vehicles frequently. A noteworthy example is Qualitas Compania de Seguros, a Mexico-based auto insurance company. In April 2023, Qualitas implemented Octo's driving behavior analytics for its commercial fleet insurance. This utilization of technology enables fleet owners to track vehicles, offer customers precise logistics information, and improve driver safety by leveraging real-time telematics data. The adoption of usage-based insurance and the integration of driving behavior analytics reflect the industry's commitment to leveraging innovation for more personalized, efficient, and data-driven insurance solutions.

In April 2024, Kingfisher Insurance, a UK-based insurance broker, acquired Lynbrook Insurance Services for an undisclosed amount. This acquisition allows Kingfisher Insurance to integrate Lynbrook's expertise, enhancing its offerings in the niche of classic vehicle insurance and complementing its existing brand, Peter James Insurance. Lynbrook Insurance Services is a UK-based provider specializing in comprehensive motor insurance policies tailored to various needs.

Major companies operating in the motor insurance market include Berkshire Hathaway Inc., Ping An Insurance (Group) Company of China, Ltd., Allianz SE, AXA S.A., Generali Group, State Farm Mutual Automobile Insurance Company, The People's Insurance Company Group of China Limited, MetLife, Inc., China Pacific Insurance (Group) Co, Ltd., American International Group, Inc., Tokio Marine Holdings Inc., The Allstate Corporation, The Progressive Corporation, Nationwide Mutual Insurance Company, Zurich Insurance Group Ltd, Travelers Companies Inc., United Services Automobile Association, Government Employees Insurance Company, Aviva plc, Assicurazioni Generali S.p.A., American Family Insurance Group, Farmers Insurance Group of Companies, The New India Assurance Company Limited, Reliance General Insurance Company Limited, Universal Sompo General Insurance Company Limited, HDFC ERGO General Insurance Company Limited, Liberty Mutual Insurance Companies.

North America was the largest region in the motor insurance market in 2024. Asia-Pacific is expected to be the fastest-growing region in the global motor insurance market during the forecast period. The regions covered in the motor insurance market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the motor insurance market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Motor insurance is a type of automotive insurance policy designed to provide coverage for vehicles, mitigating financial losses arising from accidents or physical damage. This contractual arrangement involves the insurer assuming the risk of potential losses incurred by the owner or driver of a car due to harm inflicted on people or property resulting from an accident. In essence, motor insurance serves as a protective financial measure, offering financial support and compensation in the event of unforeseen incidents involving insured vehicles.

The principal categories of motor insurance encompass treaty reinsurance and facultative reinsurance. Treaty reinsurance involves an insurance company purchasing coverage from another insurer, typically encompassing an entire policy grouping or a comprehensive motor insurance package. Various policy types fall under this umbrella, including liability insurance, comprehensive coverage, collision coverage, and personal injury protection. This form of reinsurance is instrumental in safeguarding both new and older vehicles, spanning a diverse range of vehicle types, such as passenger cars, light commercial vehicles (LCV), and heavy commercial vehicles (HCV). Treaty reinsurance provides a robust mechanism for automotive coverage across a spectrum of vehicles and associated risks.

The motor insurance market research report is one of a series of new reports that provides motor insurance market statistics, including motor insurance industry global market size, regional shares, competitors with a motor insurance market share, detailed motor insurance market segments, market trends and opportunities, and any further data you may need to thrive in the motor insurance industry. This motor insurance market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The motor insurance market includes revenues earned by entities by providing fully comprehensive insurance, third-party insurance, and theft insurance. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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