Pay-as-you-drive (PAYD) product type segment accounted for the largest market share in 2015 owing to its cost efficiency. Manage-how-you-drive (MHYD) is anticipated to grow at the fastest rate from 2016 to 2022, as it provides higher level of freedom and flexibility to the customers.
Portland, OR -- (SBWIRE) -- 09/22/2017 -- Usage-based insurance (UBI) is a telematics-based insurance service in which premiums are based on driving behavior of consumers. Type of road used, braking, and cornering pattern are amongst the factors according to which the premiums are charged. Usage-based insurance includes different services such as pay-as-you-drive (PAYD), pay-how-you-drive (PHYD), and manage-how-you-drive (MHYD).
The global market is expected to garner $123 billion by 2022, registering a CAGR of 36.4% during the forecast period 2016-2022. North America is expected to grow at the fastest pace during the forecast period, owing to the upsurge in demand from the U.S. and Canada.
Players have adopted partnership and expansion as their key strategies to increase their market share. For instance, Progressive Corporation, entered into a partnership with Zubie, a U.S. based telematics solution provider. Local companies, such as Admiral Group plc, Allstate Corporation and others primarily in developed markets, offer tough competition to the established players. Privacy concerns and increase in telematics installation cost have posed major challenges for manufacturers. The key developmental strategies adopted by the companies are discussed in the report.
The global usage-based insurance market is segmented based on type, technology, and geography. The segmentation by type includes pay-as-you-drive (PAYD), pay-how-you-drive (PHYD), and manage-how-you-drive (MHYD). On the basis of technology, the market is divided into OBD-II, smartphone, hybrid, and black-box.
Manage-how-you-drive (MHYD) segment is anticipated to grow at the fastest rate during the forecast period, as it provides higher level of flexibility and freedom to the customers. In terms of technology, Black Box dominates the market, accounting for over 60% of the total market revenue. From a growth perspective, smartphone technology is projected to exhibit the highest CAGR over the forecast period.
KEY FINDINGS OF THE USAGE-BASED INSURANCE MARKET STUDY:
Europe generated the maximum revenue in the year 2015 followed by North America.
Manage-how-you-drive (MHYD) segment is expected to grow at the fastest rate from 2016 to 2022.
In the year 2015, pay-as-you-drive (PAYD) generated the highest revenue in the global usage based insurance market, followed by pay-how-you-drive (PHYD).
By technology, smartphone and hybrid-based insurance programs are expected to witness higher growth.
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