June 30, 2020
According to a recent study titled ‘Global Insurance Telematics Market Size study with COVID-19 Impact, by Type (Pay-as-you-drive and Pay-how-you-drive), Deployment Mode (Cloud and On-Premises), by Offering (Hardware and Software), by End-User Vertical (Passenger Vehicle and Commercial Vehicle) and Regional Forecasts 2020-2026’, available with Market Study Report LLC, global insurance telematics market was worth USD 1.9 billion in 2019 and is projected to expand with a CAGR of 18.5% through 2026.
Strict regulatory compliance & regulations, coupled with improved risk assessment & management policies are augmenting the growth of global insurance telematics market. Moreover, approximately 66% of global population owned smartphones in 2018 as compared to 58% in 2016, cites Zenith’s Mobile Advertising Forecasts 2017. Hence, proliferation of smartphones, along with growing consumer inclination towards in-car connectivity and decline in cost of connectivity solutions are other major rationales contributing towards the market growth.
However, COVID-19 pandemic has caused a major disruption in the insurance industry due to government mandating people to stay within their homes, leading to temporary shutdown of offices and shift towards working from home trend. On the bright side, the situation has encouraged the installation of telematics in cars. This driver monitoring technology enables insurers to identify safe drivers and reward them with abridged car insurance policies. Improved safety & security services, including medical aid and automatic crash notification are the key features augmenting the demand for telematics among insurers.
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For the uninitiated, insurance telematics involves deployment of small devices in the client’s car to collect data pertaining to vehicle speeding, braking patterns, and travel distance, to assess the driving skills. This information assists insurers in approximating the insurance cost in relation to each driving aspect which gets reflected on the paying price for the insurance. In addition, this data is also accessible to drivers partaking the program, enabling them to improve their driving behavior and consequently reduce premiums.
Although, global insurance telematics will foresee considerable gains in the ensuing years, privacy concerns regarding personal data is likely to hamper the industry growth over the forecast period.
As per the regional analysis, the market is fragmented into North America, Europe, Asia Pacific, Latin America, and Rest of the World. North America insurance telematics market is poised to showcase substantial growth in the coming years, owing to extensive adoption of insurance telematics solutions to address the dynamic marketplace.
Some of the renowned industry players include Octo Telematics, Aplicom OY, Agero Inc., Masternaut Limited, Telogis, Sierra Wireless, MiX Telematics, Trimble Inc., TomTom Telematics, and Verizon Enterprise Solutions.