In the United Kingdom, younger drivers paid more on average for their car insurance than older drivers in 2024. A driver who is around 20 years old would be charged roughly *** British pounds whereas a driver in their 30s would be charged an average rate of *** British pounds. This higher premium stems from the idea that young drivers engage in more risky driving behavior, such as drunk driving, and therefore pose a higher risk to insurance companies. Young drivers pay more, but also tend to have more coverage Prices of different car insurance cover plans in the UK have increased since early 2022 and exceeded *** British pounds in 2023. Third party, fire and theft plans overall had higher premiums than comprehensive plans. This, however, is because the basket of risks reflects the type of driver that buys such cover, which is typically young drivers.

One of the perceived future benefits of buying insurance online, other than more individualized policies, faster processing and risk assessment and a better overall customer experience is that, with the use of digital data, average premiums for individuals will fall. One way in which insurtech companies are looking to improve on mitigating risks and enhancing customer experience in the motor insurance industry is through telematics. Telematics is an offset of information technology that deals with the transmission of digital computerized information. Already, motor insurance is becoming less about customer demographics but by individual behavior, using real time data collected from your vehicle. Where and when you drive, what the traffic is like where you drive, how fast and often you drive are some of the data points that can determine how much you will pay for car insurance in the near future. Statista estimates that the overall average cost of online premiums for motor insurance will decrease between 2018 and 2024. To learn more about the future of the B2C digital insurance industry in the UK, read our in-depth report.

The statistic presents the value of gross premiums written by motor vehicle insurance companies in the United Kingdom from 2009 to 2013 and a forecast thereof until 2025. The value of motor vehicle insurance sector in the United Kingdom amounted to approximately 20.93 billion U.S. dollars in 2013 and it was projected to grow to approximately 42.54 billion U.S. dollars in 2025.

The United Kingdom Motor Insurance Market is Segmented by Coverage Type (Third-Party, Comprehensive and More), Vehicle Type (Passenger Cars, and More ), End-Users (Individual, and More), Distribution Channel (Direct, and More), Purchase Mode (Online, and More), Technology (Traditional, Usage-Based, and More), Claims Type (Own Damage, Third-Party Liability), and Region. The Market Forecasts are Provided in Terms of Value (USD)

Statista estimates that the future of buying car insurance in the United Kingdom will be dominated by online sales. Price comparison websites are particularly popular with UK consumers, with the leading five online insurance groups (share of voice) being aggregator websites. By 2024, it is estimated that ********** of the total value of motor insurance premiums written will come from online sales. To learn more about the future of the B2C digital insurance industry in the UK, read our in-depth report.

Motor Vehicle Insurance revenue is forecast to rise at a compound annual rate of 3.3% over the five years through 2024-25 to £26.9 billion, including an estimated growth of 19.7% in 2024-25. Often, insurers invest the premiums earned from insurance activities to generate additional income. Since the Solvency II EU directive came into force on January 1 2016, profitability has been constrained as the level of regulation regarding investment picked up. This was worsened by changes to the Ogden rate in March 2017, which lifted the payout due to a claimant compared to the same settlement at the old rate. Rising tax rates in recent years has also resulted in less fruitful operating conditions. The COVID-19 outbreak dampened demand as consumers and businesses reined in vehicle usage amid lockdown restrictions. Yet, this also reduced the number of claims and payouts processed by insurers. Since the COVID-19 outbreak, insurers have had to contend with high claims costs as the inflationary environment ratcheted up the price of key components used to repair cars, hurting profitability. This resulted in premiums picking up in 2023-24 as insurers sought to offset elevated claims costs, driving revenue growth and a return to profitability for many insurers. Motor premiums are set to remain elevated in 2024-25 but begin to drop as inflationary pressures subside and claims volumes slump, with ABI reporting a reduction for the first time in two years in June 2024. Motor Vehicle Insurance revenue is forecast to climb at a compound annual rate of 5.3% over the five years through 2029-30 to reach £34.8 billion. The total number of registered vehicles in the UK will pick up, driven by the production of electric vehicles, which bring additional challenges to insurers, requiring more complex and expensive repairs. Investors are also optimistic about capital markets as corporate earnings and economic growth look on the up, supporting stock markets. Fixed income is also set to benefit in the higher interest rate environment despite expected rate cuts, aiding coupon income. The growing adoption of AI will also support revenue growth in the coming years, allowing insurers to improve risk estimations and speed up decision-making.

The United Kingdom Car Insurance Market is Segmented by Coverage Type (Third-Party Liability, Collision/Comprehensive, and More), Application (Personal, Commercial), Distribution Channel (Direct-To-Customer, Intermediated, and Embedded), Vehicle Powertrain (Internal-Combustion, Battery Electric, and More), and Region. The Market Forecasts are Provided in Terms of Value (USD).

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Motor Vehicle Insurance Market Size 2024-2028

The motor vehicle insurance market size is forecast to increase by USD 545.9 billion, at a CAGR of 10.44% between 2023 and 2028.

The market is experiencing significant shifts driven by increasing government regulations on mandatory insurance coverage in developing countries and the digitalization of the industry. These factors are shaping the market's strategic landscape, presenting both opportunities and challenges for insurance players. Government regulations in developing countries are pushing for mandatory insurance coverage, expanding the potential customer base for motor vehicle insurers. This trend is particularly noticeable in Asia Pacific and Latin America, where economic growth and urbanization are leading to increased car ownership. However, this regulatory environment also tightens the competitive landscape, as more players enter the market and compliance becomes a priority.
Simultaneously, the digitalization of the motor vehicle insurance industry is transforming the way insurers engage with customers and manage risk. Digital platforms enable real-time underwriting, claims processing, and customer service, enhancing the overall customer experience. However, this digital shift also brings challenges, such as data security concerns and the need for robust IT infrastructure. To capitalize on opportunities and navigate challenges effectively, insurers must stay abreast of regulatory changes and invest in digital capabilities.

What will be the Size of the Motor Vehicle Insurance Market during the forecast period?

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The market continues to evolve, shaped by dynamic market forces and advancements in technology. AI-powered claims processing streamlines underwriting and settlement negotiations, while digital insurance platforms offer convenience and personalized pricing. Data analytics and credit scoring inform risk assessment and customer segmentation, shaping insurance regulations and product offerings. Collision coverage and liability limits are subject to ongoing adjustments, influenced by factors such as driving record and insurable interest. Third-party administrators (TPAs) and legal counsel facilitate dispute resolution, ensuring regulatory compliance and comparative negligence assessments. Fraud detection and independent verification are essential components of claims processing, with advanced predictive modeling and accident reconstruction techniques aiding in claims investigation and policy administration.

How is this Motor Vehicle Insurance Industry segmented?

The motor vehicle insurance industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

Application

  Personal
  Commercial


Distribution Channel

  Brokers
  Direct
  Banks
  Others


Vehicle Age

  New Vehicles
  Old Vehicles
  New Vehicles
  Old Vehicles


Coverage Type

  Liability Insurance
  Collision Insurance
  Comprehensive Insurance


Geography

  North America

    US
    Canada
    Mexico


  Europe

    France
    Germany
    Italy
    Spain
    UK


  Middle East and Africa

    UAE


  APAC

    China
    India
    Japan
    South Korea


  South America

    Brazil


  Rest of World (ROW)

By Application Insights

The personal segment is estimated to witness significant growth during the forecast period.

Motor vehicle insurance is a crucial financial protection for vehicle owners and drivers. The insurance policy, which is a compulsory requirement under the Motor Policy, offers coverage for both comprehensive and third-party liability packages. Personal insurance, an optional add-on cover, safeguards the owner or driver against accidental injuries. Insurance agents and brokers play a significant role in advising clients on coverage limits and policy options. Actuarial modeling and predictive analytics are used to assess risk and determine personalized pricing. Liability coverage, including property damage and bodily injury, is a key component of motor vehicle insurance. Fraud detection and independent verification are essential for dispute resolution and maintaining regulatory compliance.

Digital insurance platforms and ai-powered claims processing streamline the claims management process. Data analytics and customer segmentation help insurers tailor policies to individual needs. Usage-based insurance and mobile apps provide real-time data for risk assessment and customer retention. Insurance regulations mandate coverage for medical payments and accident reconstruction, as well as policy administration and claims processing. Policy cancellatio

The average annual cost of fully comprehensive motor insurance in the United Kingdom rose in the first quarter of 2023, increasing to *** British pounds. This is ** British pounds more than in the previous quarter, and over ** British pounds more than the average cost in the first quarter of 2022.

The Classic Car Insurance industry generates revenue from two main sources: premium income and investment income. There are many classic car insurance policies, including comprehensive cover, laid-up cover, and third-party, fire and theft cover, with the comprehensive cover being the most prevalent form. The level of risk and the premium prices vary considerably, depending on the type of policy. Classic car insurance revenue is expected to grow at a compound annual rate of 1.1% over the five years through 2025-26 to £835.9 million, including projected growth of 3.5% in 2025-26. Traditional markets performed poorly in 2022 amid rising interest rates and rampant inflation, weighing on investment income. Yet, this made the intangible asset of classic cars an attractive alternative to hedge against rising prices, lifting demand for insurance. In 2023-24, the potential for rate cuts and improving economic growth supported a rally in both stocks and bond markets in the latter part of the year. Although this supported investment income, it also softened demand for classic cars with investors drawn to the attractive returns offered by traditional capital markets. The tightening cost-of-living squeeze has also hit demand for classic cars with buyers becoming more careful with their money. Over the two years through 2025-26, geopolitical uncertainty surrounding the war in Ukraine, conflict in the Middle East and potential trade protectionism have made classic cars more appealing as a source of diversification, aiding demand for insurance and supporting revenue growth. However, the introduction of the fair pricing regulation has weighed on the average profit margin in recent years, with insurers no longer able to attract new customers with lower premiums than that of their existing customers. Over the five years through 2030-31, industry revenue is anticipated to ramp up at a compound annual rate of 2.8% to reach £915.1 million. Normalising inflation and energy prices stabilising is set to support demand for classic cars in the short term, as people loosen their purse strings and opt for large-ticket purchases like classic cars. Fierce price competition is set to persist, resulting in more insurers turning to AI to process vast amounts of data and be more responsive in their pricing. A partial easing of Solvency II regulations will also benefit the classic car insurance industry, freeing up capital so insurers can underwrite more policies.

The Europe Car Insurance Market report segments the industry into By Coverage (Third-Party Liability Coverage, Collision/Comprehensive/Other Optional Coverage), By Application (Personal Vehicles, Commercial Vehicles), By Distribution Channel (Agents, Banks, Brokers, Other Distribution Channel), and By Geography (Germany, UK, France, Switzerland, Rest of Europe). Get five years of historical trends and future forecasts.

The cost of comprehensive motor insurance in the United Kingdom reached an all-time high in the first quarter of 2024. As of the third quarter of 2024, the average cost of comprehensive motor insurance was approximately *** British pounds. Age also plays a role in the price of car insurance with 20- and 75-year-olds paying the most in 2024.

The United Kingdom motor insurance market is expected to witness significant growth in the coming years, driven by rising insurance premium rates, increasing vehicle ownership, and growing risk awareness among consumers. The market is also expected to benefit from the growing popularity of telematics devices and pay-as-you-drive insurance. Recent developments include: Feb 2022: For an initial payment of GBP 47.5 million, AXA UK&I purchased the renewal rights to Ageas UK's commercial operations. This acquisition reinforces AXA's growth strategy and dedication to its commercial business clients and broker alliances, particularly in the SME and Schemes market sectors. About 100 Ageas UK personnel will transfer to AXA Commercial as part of the arrangement to provide continued support and service delivery., Jan 2022: The cost of a comprehensive car insurance policy in Britain is expected to be volatile this year after rising 5% in the final quarter of 2021 as more drivers took to the roads to ease COVID-19 curbs. Motorists must pay GBP 539 (USD 734.06) on average for their comprehensive car insurance premiums.. Key drivers for this market are: Data Privacy Regulations, Business Interruption. Potential restraints include: Complexity and Lack of Understanding, Cost of Coverage. Notable trends are: High Volatility in Car Insurance Premiums During the Past Few Years.

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Automotive Usage-Based Insurance Market Size 2024-2028

The automotive usage-based insurance market size is expected to grow by USD 67.51 billion at a CAGR of 25.1% from 2023 to 2028. Market growth is driven by flexible pricing models offering personalized coverage, government regulations mandating motor vehicle insurance, and advancements in telematics and data analytics. These factors enable innovative UBI programs and foster an environment of innovation and advancement. Trends indicate a shift towards smartphone-based UBI and mobility-as-a-service, revolutionizing traditional insurance models. However, challenges such as data security issues and fraudulent claims persist, requiring continuous advancements in telematics and state regulations to ensure the integrity of the automotive insurance ecosystem. As insurers and OEMs develop new solutions, the industry adapts to evolving consumer needs and embraces technological advancements.

What will be the Size of the Automotive Usage-Based Insurance Market During the Forecast Period?

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Automotive Usage-Based Insurance Market Segmentation

The automotive usage-based insurance market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD Billion' for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments

Application Outlook 

  Embedded UBI
  App-based UBI





Pricing Scheme Outlook 

  PHYD
  PAYD
  MHYD

Region Outlook


  North America

    The U.S.
    Canada


  South America

    Chile
    Brazil
    Argentina 





  Europe

    U.K.
    Germany
    France
    Rest of Europe





  APAC

    China
    India





  Middle East & Africa

    Saudi Arabia
    South Africa
    Rest of the Middle East & Africa

The market is revolutionizing the insurance industry with its focus on telematic devices and connected cars. This innovative approach to insurance relies on on-road vehicles equipped with car telematics to track automotive usage and consumer driving behavior. Insurance companies leverage telematics data gathered from smartphones and black box devices to offer personalized insurance premiums based on factors like location tracking and fuel consumption. This shift from traditional insurance models to UBI and specialty insurance creates an automotive usage-based insurance ecosystem, enhancing data security and enabling vehicle recovery while addressing concerns such as fraudulent claims. With the integration of advanced technology and hybrid-based UBI, the market continues to expand, catering to both passenger cars and commercial vehicles in the mobility-as-a-service landscape.

By Application

The embedded UBI segment is estimated to witness significant growth during the forecast period. Embedded UBI solutions use external devices fitted into vehicles onboard diagnostics (OBD) to collect data about driving behavior. The data is transmitted to the insurer for optimum premium pricing. As the requirement of an external device posed a challenge for the adoption of embedded UBI and on-board diagnostics telematics, app-based UBI saw high adoption in the last 2-3 years.

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The embedded UBI was the largest segment and was valued at USD 10.10 billion in 2018. Additionally, governments around the world have established various committees to ensure safety during road transportation. Russia, Brazil, and many countries in Europe have mandated automotive telematics, such as emergency calls and stolen vehicle assistance, in vehicles. This trend will likely be followed by developing nations like India and China during the forecast period, thereby increasing the market share of embedded solutions. Additionally, it is expected that higher adoption of embedded solutions from luxury OEMs as they are ready to invest heavily in differentiating their products in the market. Therefore, the adoption of embedded UBI solutions in the automotive market will witness a continuous rise. This, in turn, is expected to drive automotive usage-based insurance market growth during the forecast period.

Key Regions

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Europe is estimated to contribute 34% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. Europe dominates the automotive market. Factors such as pricing play an important role in the adoption of automotive UBI in this region. The largest distribution channel in Europe is through price comparison websites. These websites allow users to compare and choose among the various offerings provid

This statistic shows the average cost of car insurance in the United Kingdom (UK) in British pounds by age group and gender in 2018. The average cost of car insurance for those in their twenties was the highest out of the age ranges with an average of ***** British pounds. On average women pay more for car insurance in the United Kingdom (UK) than men. Women in their twenties paid on average ***** British pounds a year as to ***** British pounds paid by men.

Connected Cars Insurance Market Outlook

The global market size for connected cars insurance was approximately USD 31.3 billion in 2023, and it is projected to reach around USD 112.8 billion by 2032, growing at a compounded annual growth rate (CAGR) of 15.1% from 2024 to 2032. A major growth factor for this market is the increasing integration of advanced telematics and IoT technologies in the automotive sector, which enables real-time monitoring and data-driven decision-making for insurance providers and customers alike.

One of the primary growth factors for the connected cars insurance market is the rapid advancement in vehicle telematics and connectivity solutions. These technologies provide real-time data about driving behavior, vehicle health, location, and other critical parameters. This data helps insurance companies to offer customized and usage-based insurance policies such as Pay-As-You-Drive (PAYD) and Pay-How-You-Drive (PHYD). As a result, customers benefit from more personalized, fairer premiums, leading to growing adoption of connected car insurance policies.

Another significant driver for the market is the increasing awareness and demand for enhanced vehicle safety and security features. Connected cars come equipped with advanced safety systems, such as collision avoidance, lane-keeping assistance, and emergency braking, which not only reduce the likelihood of accidents but also lower the risk for insurance companies. This, in turn, leads to lower insurance premiums for customers, further incentivizing the adoption of connected car insurance policies. Moreover, the integration of telematics and IoT devices facilitates quicker and more efficient claims processing, enhancing customer satisfaction and driving market growth.

The proliferation of smart cities and the development of intelligent transportation systems also contribute to the growth of the connected cars insurance market. Governments and municipalities are increasingly investing in smart city projects that focus on improving road safety, reducing traffic congestion, and optimizing transportation infrastructure. Connected cars play a crucial role in these initiatives, as they enable seamless communication between vehicles, infrastructure, and traffic management systems. This interconnected ecosystem not only enhances the overall driving experience but also creates opportunities for insurance companies to offer innovative and value-added services, further propelling market growth.

From a regional perspective, North America holds a significant share of the connected cars insurance market, driven by the high adoption rate of advanced automotive technologies and the presence of major insurance providers and technology companies in the region. Europe is another key market, with countries like Germany, the UK, and France leading the way in connected car adoption and smart city initiatives. The Asia Pacific region is expected to witness substantial growth over the forecast period, fueled by the rapid expansion of the automotive industry, rising disposable incomes, and increasing investments in smart city projects. Latin America and the Middle East & Africa regions are also anticipated to experience growth, albeit at a relatively slower pace, as the adoption of connected car technologies gradually gains momentum in these markets.

Type Analysis

The connected cars insurance market is segmented by type into Pay-As-You-Drive (PAYD), Pay-How-You-Drive (PHYD), and Manage-How-You-Drive (MHYD). Pay-As-You-Drive insurance allows customers to pay premiums based on the actual distance they drive. This model benefits low-mileage drivers who can enjoy reduced premiums compared to traditional insurance policies, which are typically based on estimated annual mileage. The increasing adoption of telematics devices that accurately track mileage is a key factor driving the growth of the PAYD segment.

Pay-How-You-Drive insurance, on the other hand, focuses on rewarding safe driving behavior. This type of insurance uses telematics data to monitor driving patterns, such as speed, acceleration, braking, and cornering. Drivers who exhibit safer driving behavior are rewarded with lower premiums, creating an incentive for customers to adopt safer driving habits. The growing emphasis on road safety and the implementation of stringent traffic regulations are major factors contributing to the growth of the PHYD segment.

Manage-How-You-Drive insurance combines elements of both PAYD and PHYD models, offering a comprehensive solution that takes into account both mileage and driving behav

Forecast: Motor Vehicle Insurance Gross Premiums by Business Type in the UK 2022 - 2026 Discover more data with ReportLinker!

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Insurance Analytics Market 2024-2028

The insurance analytics market size is projected to increase by USD 13.14 billion, at a CAGR of 15.96% between 2023 and 2028. The growth rate of the market depends on several factors, including the increasing government regulations on mandatory insurance coverage in developing countries, the increasing availability of big data tools, and the growing need for insurers to make data-driven decisions. Insurance analytics involves the use of data analysis and statistical techniques to gain insights into the insurance industry. It helps insurers make informed decisions, assess risks, detect fraudulent activities, and enhance overall operational efficiency. This technology leverages data from various sources, including customer information, claims data, and market trends, to optimize underwriting, pricing, and claims processing activities.

The report includes a comprehensive outlook on the Insurance Analytics Market, offering forecasts for the industry segmented by Deployment, which comprises cloud and on-premises. Additionally, it categorizes Component into tools and services and covers Regions, including North America, Europe, APAC, Middle East and Africa, and South America. The report provides market size, historical data spanning from 2018 to 2022, and future projections, all presented in terms of value in USD billion for each of the mentioned segments.

What will be the size of the Insurance Analytics Market During the Forecast Period?

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Insurance Analytics Market Overview

Insurance Analytics Market Driver

Increasing government regulations on mandatory insurance coverage in developing countries is the key factor driving market growth. Third-party motor insurance is compulsory for vehicles that run on public roads in some countries. For example, anyone who owns or operates a vehicle in the state of Maine in the US must have at least the minimum amount of insurance required by law. Similarly, health insurance is mandatory in most developed countries. Travel insurance is mandatory for a person traveling to a foreign country (in most developed countries).

Furthermore, the travel Insurance industry is expected to grow at a rapid pace due to the increase in cross-country tourism. The health insurance analytics industry is growing slowly in developing countries because of the increased awareness about the importance of having health insurance. As a result, the growth of various types of insurance is resulting in the rapid expansion of the global insurance analytics market.

Insurance Analytics Market Trends

Increasing adoption of insurance in developing countries is the primary trend shaping market growth. The market is currently expanding at a fast pace because of the increasing awareness about the importance of insurance. Emerging markets, mainly China and India, are expected to contribute to the rapid growth of the insurance industry.

In addition, the digital transformation in the insurance industry has resulted in a rapid increase in the demand for upgraded customer-facing insurance analytics solutions. With the increasing demand for insurance in developing countries, the demand for insurance analytics is also growing at a fast pace. Traditional methods of insurance are not favored anymore.

Insurance Analytics Market Restrain

The complexity of integrating diverse data sources is a challenge that affects market growth. Insurers often deal with vast amounts of data generated by various channels, and integrating this data seamlessly can be complex and complicated. Standardizing data formats, ensuring data quality, and establishing interoperability between different systems are crucial aspects. Overcoming these integration challenges is essential for insurers to harness the full potential of analytics and derive meaningful insights from the diverse datasets available to them.

Furthermore, the insurance sector is a heavily regulated industry, and data use and integration must comply with various regional and industry-specific regulations. Ensuring adherence to compliance standards adds complexity to the overall integration process. In addition, inaccuracies or inconsistencies can lead to flawed insights and decisions.

Insurance Analytics Market Segmentation By Deployment

The market share growth by the cloud segment will be significant during the forecast period. Cloud-based insurance analytics refers to the use of cloud computing services to store, analyze, and process insurance-related data. By leveraging cloud platforms, insurers can benefit from enhanced scalability, flexibility, and accessibility. This enables the efficient handling of large datasets, faster analytics processing, and the ability to access insights from virtually anywhere.

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