Usage-based insurance market poised to hit $286b by 2032

The Asia-Pacific region is emerging as a key growth driver.

The usage-based insurance (UBI) market was valued at $52.1b in 2023 and is projected to settle at a compound annual growth rate (CAGR) of over 24% between 2024 and 2032. 

The Asia-Pacific region is emerging as a key growth driver for the UBI market, fueled by increasing traffic, advances in telematics technology, and infrastructure improvements in countries such as China and India. 

UBI, a form of auto insurance, relies on in-vehicle telematics systems to monitor driving habits such as mileage, speed, braking, acceleration, and travel time. 

The adoption of UBI systems is driven by insurers’ focus on profitability and improved pricing accuracy. 

Leveraging machine-to-machine technologies, these systems enable insurers to offer personalised premiums based on real-time risk assessments rather than relying solely on historical claims data. This approach reduces claim costs and enhances revenue growth.

The market is segmented into passenger and commercial vehicles, with passenger vehicles expected to surpass $285.9b by 2032.