The global insurance telematics market is anticipated to register a CAGR of 22.1% over the forecast period owing to the increasing number of laws and regulations related to the security and safety of vehicles. The decreased cost of connectivity solutions is expected to propel the growth of the market.
Increasing penetration of smartphones and the rising interest of the global consumer in in-car connectivity has also led to the growth of the market.Advanced solutions in the market promisethe end-user a more accurate drive risk score from telematics data, further improving the growth prospects of the market
Lack of customer awareness regarding insurance telematics and security concerns associated with mobile and cloud technologies are some of the significant challenges for the market. The market growth is also restrained due to privacy concerns related to customers’ confidential data.
The global insurance telematics market can be segmented by deployment, type, offering, end use, enterprise size, and region. On the basis of deployment, the market can be further segmented into on-premise and cloud. The cloud deployment segment is anticipated to grow significantly over the forecast period as it offers the end-user a scalable and flexible infrastructure for handling multiple devices and analyzing the data that emerges from multiple sensors installed in vehicles. Cloud deployment provides continuous data accessibility and incurs less cost for maintenance.
On the basis of type, the market has been segmented into Pay-as-you-drive, Pay-how-you-drive, and Pay-as-you-go. The Pay-how-you-drive (PHYD) segment is anticipated to grow steadily across the globe over the forecast period owing to the increase in the sale of vehicle insurance based on telematics, which includes PHYD policies.In addition, Pay-how-you-drive policies use GPS technology to check how a vehicle is being driven.
On the basis of offerings, the market has been segmented into hardware and software solutions. Automotive manufacturers are widely integrating hardware solutions to monitor vehicle performance and system failures.
Based on enterprise size, the market has been segmented into small & medium-sized enterprises (SMEs) and large enterprises. The small and medium-sized enterprise segment is likely to expand at a higher growth rate over the forecast period as SMEs are extensively adopting cloud-based insurance telematics. The flexible and scalable infrastructure of cloud-based insurance telematics allows the analysis of large volumes of data generated from multiple sensors installed on vehicles and for handling multiple devices.
On the basis of end use, the insurance telematics market has been segmented into a personal line, commercial line, and fleet level. The fleet level segment is experiencing high growth as it provides risk management support by analyzing customer’s driving behavioral data.
The insurance telematics market can be segmented by region into North America, Europe, Asia Pacific, Latin America, and MEA. The North American regional market is presently leading, owing to the rise in smartphone penetration and the ability of smartphones to connect to on-board vehicles wirelessly using Bluetooth. The adoption rate of telematics is increasingly supported by regulatory changes in this region. Various insurance enterprises in this region are collaborating with automotive manufacturers for providing insurance telematics applications to improve and provide customized offerings for local clients.
Some of the key players in the insurance telematics market are Sierra Wireless, Inc., Octo Telematics, TomTom Telematics, Trimble Navigation, Verizon, Masternaut Limited, Aplicom, MiX Telematics, and Agero Inc. Agreements, collaborations, and partnerships are the major strategies adopted by these companies. Companies such as MiX Telematics, Trimble Navigation, Sierra Wireless, and Verizon are opting for mergers and acquisitions to expand their market reach.
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