Global auto insurance market to hit $2.27t by 2032

However, the adoption of autonomous vehicles could dampen growth.

The auto insurance market, valued at $923.4b in 2023, is estimated to reach $2.27t by 2032 with a compound annual growth rate of 10.8% from 2024 to 2032, according to an Allied Market Research report.

Key drivers include the increasing number of accidents, stricter government regulations for auto insurance, and rising vehicle sales. However, the report said the adoption of autonomous vehicles could potentially dampen market growth.

Despite this potential challenge, the implementation of technology in existing products and services, along with the rising demand for third-party liability coverage in emerging economies, is projected to create opportunities for market development during the forecast period.

In terms of coverage, third-party liability coverage held the largest market share in 2023, whilst the direct response segment was the highest, based on distribution channel.

New vehicles held the largest market share in 2023 as consumers increasingly prefer vehicles with the latest technology, safety features, and fuel efficiency. Advances in automotive technology, such as electric vehicles, autonomous driving capabilities, and enhanced connectivity, further drive demand for new vehicles, the report said.

Personal vehicles experienced significant market growth due to their cost-effectiveness, improved comfort, and higher durability, it added.