Global Telematics Insurance Market Research Report: Forecast (2023-2028)
In order to track the real-time driving behavior of drivers telematics insurance is a solution used by motor insurance companies & accordingly decide their policy premiums. It works by setting up a device, known as a Black Box, in the vehicle, which monitors & stores its different parameters like speed, braking pattern, driving style, distance, and the type of road one travels. Telematics insurance is a potential system to evaluate the ongoing situation of motor insurance and positively impact policy claims, risk selection, & fraud detection. Numerous research & developments are being conducted toward expanding its utilization globally.
Market Insights & Analysis: Global Telematics Insurance Market (2023-28)
The Global Telematics Insurance Market is anticipated to grow at a CAGR of around 34% during the forecast period, i.e., 2023-28. Reduced costs of connected car solutions, stringent norms imposed by governments of different countries worldwide associated with driver safety, growing consumer inclination toward in-car connectivity, and the mounting penetration of smartphones worldwide are the prime aspects likely to drive the market through 2028. Besides, various technological advancements in the automotive insurance sector, such as the integration of telematics into vehicles are also fueling the market growth.
|Study Period||Historical Data: 2018-21|
|Base Year: 2022|
|Forecast Period: 2023-28|
|Regions Covered||North America: The US, Canada, Mexico|
|South America: Brazil, Argentina|
|Europe: The UK, Germany, France, Spain, Italy, Rest of Europe|
|Asia-Pacific: China, India, Japan, South Korea, Australia|
|Middle East & Africa: Saudi Arabia, the UAE, South Africa|
|Key Companies Profiled||Octo Group SpA, Insurance Mobility Solutions, Agero Inc, Webfleet Solutions BV, Verizon Communications Inc, AXA Group, The Progressive Corporation, Amodo Ltd, Cambridge Mobile Telematics, Generali Group, The Floow Limited, TrueMotion Inc, Insurethebox Ltd, Insure Telematics Solutions, CalAmp Corp|
|Unit Denominations||USD Million/Billion|
Automotive telematics aid in improving driving behavior & road safety, positioning insurance premiums with actual requirements through UBI (Usage-Based Insurance), and enhancing the profitability of motor insurance companies. Besides insurance & road safety improvements, telematics offers added benefits to individuals, governments, & organizations, including driving-style improvements to foster fuel economy, location-based services like real-time tracking, vehicle maintenance alerts, & recovery of stolen vehicles, among others.
The mounting demand of customers for extraordinary connectivity & intellect in their vehicles and several government initiatives for encouraging telematics services in their respective countries would create profitable prospects for the market in the coming years. Furthermore, low policy premiums and providing personalized & value-added services in insurance to effectively suffice consumer requirements are other prominent advantages of telematics insurance that would fuel the expansion of the industry during 2023-28.
Based on Deployment Type:
Of both, Cloud-based deployment is more likely to witness an upward demand trend in the Global Telematics Insurance Market. The growing integration of the Internet of Things (IoT) into vehicles is the prime aspect propelling the utilization of cloud-based solutions in telematics insurance. With soaring preferences toward cloud platforms & innovative practices in the automotive sector, most market players are now offering cloud-based UBI services.
Cloud-based telematics insurance also provides insights into various risks related to driving patterns, which can help keep track of the vehicle's running activity. Additionally, it incurs lesser data storage costs than On-Premise deployment, i.e., another crucial aspect projected to fuel the adoption of these services and propel the overall growth of the telematics insurance market in the coming years.
Based on Type:
Here, PHYD (Pay-How-You-Drive) model is expected to witness a rapidly rising demand during 2023-28. PHYD, also known as Black Box insurance, uses real-time driving data like cornering, speed, & distracted driving, among others, to more accurately compute premiums. It highly varies from conventional motor insurance policies since, with PHYD, the policy premium relies entirely upon the driving pattern while comprising other facilities like vehicle theft & roadside assistance. Moreover, it offers impressive discounts & frequent rewards for decent driving behavior.
The burgeoning demand for PHYD insurance models is primarily due to automotive manufacturers actively developing faster & more powerful vehicles that are connected & some of them even have autopilot modes. Because of this, insurance providers are offering newer & upgraded policies by swiftly adopting advanced technologies & seeking ways to reduce costs to promote the emerging connected cars sector. Many players across different nations like the United States, Canada, Japan, Germany, & France, among others, have now begun utilizing PHYD telematics to efficiently tackle the insurance costs for fleets like public transportation, driving schools, government & commercial, etc. Hence, based on these aspects, PHYD insurance offerings are projected to grab significant momentum at the global level over the coming years.
Geographically, the Global Telematics Insurance Market expands across:
Of them, Europe & North America are the largest Telematics Insurance Markets. Stringent regulations for insurance providers to deploy telematics devices in vehicles are driving the Europe Telematics Insurance Market, mainly in Italy & the UK. Italy-based companies use Black Box & smartphone application telematics to examine driving patterns. The data generated is used for formulating risk modes, which, as a result, leads to cost-effective policy premiums for customers, especially the young generation, as premium prices for them are significantly high. Furthermore, mobile apps with ADAS (Advanced Driver Assistance Systems) technologies are a crucial headway for fleet management in Italy since it has been facing a few challenges over the past few years. Hence, the above-cited aspects project remunerative opportunities for the telematics insurance market across Europe over the forecast years.
On the other front, with the vast presence of leading market players, rapid technological advancements, and tremendous demand for interconnected services in vehicles, North America is another notable contributor to the telematics insurance market growth. Automotive insurance providers across the region are increasingly adopting cloud-based solutions and shifting applications & data to the cloud network in order to stay ahead in a highly competitive market. Moreover, the mounting adoption of Mobility-as-a-Service and increasing collaborations between OEMs, insurers, and telematics providers across the US & Canada are other crucial aspects driving the regional market.
Key Questions Answered in the Market Research Report:
Frequently Asked Questions
A. The Telematics Insurance Market is projected to grow at a CAGR of around 34% during 2023-28.
A. The growing consumer inclination toward in-car connectivity and stringent norms imposed by governments of different countries worldwide associated with driver safety are the most prominent aspects projected to drive the Telematics Insurance Market in the coming years.
A. PHYD (Pay-How-You-Drive) is anticipated to emerge as an area of remunerative opportunities for the leading players in the Telematics Insurance Market through 2028.
A. Octo Group SpA, Insurance Mobility Solutions, Agero Inc, Webfleet Solutions BV, Verizon Communications Inc, AXA Group, The Progressive Corporation, Amodo Ltd, Cambridge Mobile Telematics, Generali Group, The Floow Limited, TrueMotion Inc, Insurethebox Ltd, Insure Telematics Solutions, and CalAmp Corp are the key companies operating in the Telematics Insurance Market.
A. Europe & North America would continue creating remunerative prospects for the Telematics Insurance Market during 2023-28.