The global auto insurance market size was valued at USD 825.4 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 8.8% from 2021 to 2028. The market is mainly driven by the increasing middle-class population, the advent of new digital sales channels, and the availability of a range of auto insurance covers. Auto insurance offers financial protection to customers against the physical damage of vehicles. In addition, the increasing incidence of car accidents is boosting the market growth. Changing lifestyle choices and evolving demographics globally are other major factors impacting the growth of the market. Various insurance companies are expected to maintain a strong customer relationship by finding important propositions. At present, players in the market are focusing on creating strategic plans in order to attract a large customer base. Hence, the market for auto insurance is estimated to witness strong growth during the forecast period.
The implementation of stringent government regulations for the adoption of auto insurance, the increasing number of accidents, and an increase in automobile sales globally are major factors responsible for the growth of this market. Moreover, a rise in the demand for third-party liability coverage in emerging economies and the implementation of technologies in the existing products and service lines are projected to expand the market over the forecast period.
The growing investment by prominent players in the market is also estimated to drive the market. Owing to this reason, various players in the market are focusing on improving the efficacy of their digital channels. However, the rising aging population, along with low birth rates in various regions, could hinder the growth of the market.
With the ongoing lockdown and media reports filled with tragic stories of loss of life, people are becoming aware that life cannot be taken for granted. As per as survey, it is suggested that the online sale of auto insurance has increased in the last three months. However, the average size has gone down during this pandemic.
The third-party liability coverage segment held the largest share of more than 60.0%in 2020. This insurance is compulsory for all vehicle owners under the motor vehicle act. It covers legal liability for the damage caused by the owner to the third party. Rising investment in the insurance sector by various companies is propelling the growth of third-party liability insurance. It will also register the highest growth rate over the forecast period due to its increasing demand.
The collision/comprehensive/other optional coverages segment merged as the second-largest segment in 2020. It covers the pay to replace or repair the damage of cars caused during accidents. It is typically required by the lenders. Auto insurance coverage has a limit in which the maximum amount is paid by the insurance company. As the cases of road accidents are increasing, the demand for auto insurance coverage is also growing. Owing to this reason, the segment is projected to witness considerable growth over the forecast period.
The private passenger segment held the largest share of over 85.0% in 2020 owing to its increasing demand. In this policy, the insurance is majorly covered by the insurance company. It estimates a possibility that an individual will get into an accident, causing a claim to be made against a policy.
The commercial passenger segment is expected to register the fastest CAGR of 10.1% from 2021 to 2028. This is attributed to the growing trend of auto insurance. It is a type of motor insurance policy that offers coverage in case of accidents caused by the owner-driver of the car. It is also a customized insurance policy that covers damage caused by accidents, collisions, and natural calamities.
The insurance agents/brokers segment held the largest share of more than 35.0%in 2020 due to its increasing demand. Insurance agents/brokers represent only one insurer. It allows them to sell insurance policies of one insurer from the same line of business. Thus, the segment is estimated to witness significant growth during the forecast period.
The direct response segment is estimated to register the fastest CAGR of 10.0% from 2021 to 2028. It plays an important role in economic growth. It acts as an intermediate between insurers and policy holders. It offers professional and technical advice about insurance products. They work closely with their clients in order to fulfill their needs regarding auto insurance, which, in turn, boosts the segment demand.
North America accounted for the largest share of over 40.0% in 2020 due to the increasing demand in the U.S. and Canada. The insurance companies are providing lower premium rates that reward the client’s healthy lifestyle. Moreover, a rise in the purchase of cars is another major factor driving the regional market.
Asia Pacific is expected to register the fastest CAGR of 9.6% from 2021 to 2028. This is attributed to the growing trend of auto insurance in this region. An increase in disposable income in countries, like China and India, is also driving the market. In addition, the increasing incidence of bike accidents has led to the increasing demand for auto insurance in this region. Hence, this region is estimated to witness the fastest growth over the forecast period.
The main focus of the companies is on innovating new products to meet the increasing demand for auto insurance. However, implementing sustainability has its unique limitations and challenges. Various companies are focusing on the expansion and launches of recent developments in the market. Some prominent players in the global auto insurance market include:
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Report Attribute |
Details |
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Market size value in 2021 |
USD 876.5 billion |
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Revenue forecast in 2028 |
USD 1,620.2 billion |
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Growth Rate |
CAGR of 8.8% from 2021 to 2028 |
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Base year for estimation |
2020 |
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Historical data |
2017 - 2019 |
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Forecast period |
2021 - 2028 |
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Quantitative units |
Revenue in USD billion and CAGR from 2021 to 2028 |
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Report coverage |
Revenue forecast, company ranking, competitive landscape, growth factors, and trends |
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Segments covered |
Coverage, distribution channel, application, region |
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Regional scope |
North America; Europe; Asia Pacific; Central & South America; Middle East & Africa |
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Country scope |
U.S.; Germany; U.K.; France; China; Japan; Brazil; South Africa |
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Key companies profiled |
People’s Insurance Company of China; CHINA PACIFIC INSURANCE CO.; Ping An Insurance (Group) Company of China, Ltd.; State Farm Mutual Automobile Insurance; Berkshire Hathaway Inc.; Admiral Group Plc; GEICO; Tokio Marine Group; Allianz; Allstate Insurance Company |
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Customization scope |
Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope. |
This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2017 to 2028. For the purpose of this study, Million Insights has segmented the global auto insurance market report on the basis of coverage, distribution channel, application, and region:
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