Usage-Based Automotive Insurance Market Projected to Reach USD 570.44 Billion by 2034, Growing at a CAGR of 22.6%

Global Usage-Based Insurance for Automotive Market size and share is currently valued at USD 74.42 billion in 2024 and is anticipated to generate an estimated revenue of USD 570.44 billion by 2034, according to the latest study by Polaris Market Research. Besides, the report notes that the market exhibits a robust 22.6% Compound Annual Growth Rate (CAGR) over the forecasted timeframe, 2025 – 2034

Market Definition

The Usage-Based Insurance (UBI) for Automotive Market is revolutionizing the auto insurance industry by shifting from static premium models to personalized rates based on real driving behavior. UBI programs use telematics devices or smartphone apps to monitor metrics such as mileage, speed, braking patterns, and time of travel. This data enables insurers to assess risk more accurately, reward safe driving, and reduce fraud. Drivers benefit from potentially lower premiums and greater transparency, while insurers improve risk management and customer retention. The proliferation of connected vehicles and IoT technologies is driving UBI adoption globally. Governments and regulators are also supporting UBI as a tool for promoting road safety. However, data privacy issues, inconsistent regulatory frameworks, and concerns over data accuracy remain key challenges. As AI and big data analytics mature, the market is expected to evolve rapidly, offering more dynamic and behavior-based insurance products tailored to individual driving profiles.

Key Report Highlights  

• The report highlights the key region that accounts for the highest revenue share in the global Usage-Based Insurance for Automotive market.
• It identifies the leading country within this region that makes a significant contribution to the market’s overall performance.
• The report outlines the dominant segment that holds a major share of the market.
• It also emphasizes the fastest-growing segment projected to gain strong traction during the forecast period.
• Qualitative and quantitative market analysis have been used to provide an in-depth understanding of the market.

Market Overview: Key Figures at a Glance

• Market Value in 2024: USD 74.42 Billion
• Projected Market Size in 2034: USD  570.44 Billion
• Anticipated CAGR (2025-2034): 22.6%

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https://www.polarismarketresearch.com/industry-analysis/usage-based-insurance-for-automotive-market/request-for-sample 

Market Growth Drivers

The automotive insurance industry is undergoing a paradigm shift toward usage-based insurance (UBI), driven by advancements in telematics and data analytics. UBI allows insurers to calculate premiums based on individual driving behavior, including speed, braking patterns, mileage, and time of travel. This model benefits both insurers—who can assess risk more accurately—and consumers, who are incentivized to drive safely to lower their premiums. The proliferation of connected vehicles and integration of telematics systems by OEMs make real-time data collection feasible and cost-effective. Additionally, rising consumer demand for personalized financial products is encouraging insurers to move away from traditional risk pools. Regulatory support in several regions for telematics-driven pricing is also bolstering the market. As insurance providers seek to reduce claim fraud and improve profitability, UBI offers a data-driven path toward more equitable and efficient coverage models.

Market Key Players

The competitive landscape features a mix of long-standing companies and emerging contenders. Leading players are actively pursuing R&D initiatives and strategic moves to strengthen their market position. Notable participants include

• Allianz
• Allstate Insurance Company
• American International Group, Inc.
• Assicurazioni Generali S.p.A.
• AXA
• insurethebox
• Liberty Mutual Insurance
• MAPFRE
• Progressive Casualty Insurance Company
• State Farm Mutual Automobile Insurance Company