April 5, 2016 by Canadian Underwriter
The global insurance telematics market size is expected to grow from US$857.2 million in 2015 to US$2.21 billion in 2020, at a compound annual growth rate (CAGR) of 20.9%, according to a report by ReportLinker, a market research technology company based in Lyon, France.
Consumers’ enthusiasm for in-car connectivity and growth of smartphone penetration in the insurance and automobile sector are among the factors driving the insurance telematics market, ReportLinker said in a press release on Monday. “The other factor driving the growth of the insurance telematics market is the increase in regulatory compliances and regulations,” the release added. “Furthermore, the market is expected to be driven by opportunities such as the growth in IoT [Internet of Things] and increased demand for telematics solutions in [the] insurance and automotive sector.”
In terms of regions, the insurance telematics market is segmented into five major regional segments, namely, North America, Asia-Pacific (APAC), Europe, Latin America and Middle East and Africa (MEA). “Out of the five major regions, APAC is likely to lead the market in terms of market growth, followed by Latin America,” the release said, “whereas North America will continue to have the largest market share during the forecast period.”
However, the increased need to introduce innovative insurance plans such as usage-based insurance, and induce control and visibility mechanisms has led to a wider demand among insurance and automotive enterprises for insurance telematics applications in the APAC region, ReportLinker said.
Another finding was that insurance telematics cloud deployment is expected to grow with the highest rate from 2015 to 2020. Still, on-premises deployment is expected to contribute the largest market share during the forecast period. Owing to the emergence of digital channels and evolution of technological advancement in cloud and mobile business operations, data infringement issues and operational risks, large enterprises are investing heavily in these solutions to simplify their insurance process and sustain competitive advantage, the release said.
The distribution of primary interviews for the report was as follows: by designation – C-Level: 60%; director level: 25%; and others, including sales, marketing and product managers: 15%. By region, North America constituted 10%, Europe 20%, APAC 40% and others 30%.