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HomeNewsBusinessCapgemini predicts 100% growth in mobility insurance market to $1.38 tn by 2030

Capgemini predicts 100% growth in mobility insurance market to $1.38 tn by 2030

Nominal premiums in the autonomous, connected, electric and shared mobility market to grow eightfold to half a trillion US dollars, says Capgemini report

April 19, 2023 / 06:33 IST
Premiums cumulatively collected through insurance schemes in ACES category stood at $0.07 trillion in 2021, the report said

Premiums mopped up through the ACES market are estimated to rise to $0.57 trillion by 2030.

The mobility insurance market is set to double globally, reaching a combined value of $1.38 trillion by the year 2030, global research firm Capgemini said in its 'World Property Casualty Insurance 2023' report.

Of the total mobility insurance market, the premiums collected through the traditional market stood at $0.58 trillion in 2021, the report said, adding that the same is estimated to rise to $0.81 trillion by 2030.

On the other hand, the premiums mopped up through the autonomous, connected, electric and shared (ACES) market, which stood at $0.07 trillion in 2021, is expected to soar sharply to $0.57 trillion by 2030, it added.

"As the definition of mobility expands, the mobility insurance market is poised to double from $0.65 trillion in 2021 to $1.38 trillion in 2030," Capgemini said.

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The report is based on data drawn from 22 key markets across the world, including India, Australia, the United Kingdom, the United States, China, Mexico, Hong Kong and a slew of European countries, among others.

As per the report, the automotive industry is on the cusp of "profound change". Revenues are on track to reach $3.8 trillion by 2030, up 35 percent from 2020, it said.

In the next seven years, autonomous, connected, and electric vehicles may comprise about 40 percent of the market, up from 10 percent in 2020, the report added.

The nominal premiums in the ACES category, based on real-time data, will "grow eightfold to more than half a trillion US dollars, according to our analysis", Capgemini said.

The shift towards ACES category will be fuelled by the change in customer behaviour. According to Capgemini's customer survey, which included 5,990 policyholders from 19 global markets – "66 percent of participants said they were both interested in and supportive of connected and alternate energy vehicles. And 49 percent expressed enthusiasm for autonomous vehicles."

Survey responses suggest that the adoption of micro-mobility, shared vehicles, and multi-modal transportation solutions will double by 2025, accelerated by increased demand from urban customers, it added.

As the mobility market evolves, carriers will shift from insuring assets to protecting mobility journeys by launching new business models focused on personalisation.

"In fact, 42 percent of policyholders want a single policy that covers them irrespective of their mode of transportation," the report stated.

Industry veterans whose views were shared by Capgemini suggested that customers are increasingly looking beyond the traditional insurance coverage, and that insurers need to focus on "embedded solutions", keeping in mind the changing customer sentiment.

"Future-focused mobility solutions are disrupting traditional coverage as policyholders demand embedded protection for their journey," said Laurent Floquet, CEO, Mobility & Assistance, Allianz Partners.

"As insurers think about embedded solutions, they should consider how core value propositions align with embedded opportunities and how economies of scale can be leveraged to create better point of sale, servicing, and claims experiences," added Mike Kish, the Head of Corporate and Business Development at American insurance major State Farm.

Moneycontrol News
first published: Apr 18, 2023 10:49 pm

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