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2021

Commercial Auto Insurance Market

Commercial Auto Insurance Market Size, Share, Competitive Landscape and Trend Analysis Report by Distribution Channel, Coverage Type and Vehicle Type : Global Opportunity Analysis and Industry Forecast, 2021-2030

BI : Insurance

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Author's: Aarti Goswami| Pramod Borasi | Onkar Sumant
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Commercial Auto Insurance Market Outlook – 2030

The global commercial auto insurance market size was valued at $128.44 billion in 2020, and is projected to reach $307.10 billion by 2030, growing at a CAGR of 9.2% from 2021 to 2030.

A commercial auto insurance usually provides a customized motor insurance policy to cover for damages and losses caused to or by a commercial vehicle and the respective owner-driver. This insurance is largely purchased by businesses for their motor vehicles such as trucks, pick-up vans, cabs, auto-rickshaws, tractors, commercial vans, school buses, amongst others. Commercial auto insurance includes damages and losses in situations such as accidents, collisions, natural calamities, fires, and others by covering only business-owned vehicles.

Commercial-Auto-Insurance-Market-2021-2030

Demand for commercial auto insurance continue to rise in the market by providing financial security in the form of medical injury or any other damages to the vehicle owner. In addition, stringent government guidelines regarding commercial auto insurance and increasing number of road accidents propel the commercial auto insurance market growth. However, as vehicles used in business purposes are heavy & expensive and therefore, it incurs huge commercial auto insurance premium which as a result limiting growth of the market. On the contrary, developing economies offer significant opportunities for commercial auto insurance companies to expand their offerings, owing to factors such as growth in the local businesses, rapid urbanization, rise in online e-commerce purchases which further accelerates demand for commercial vehicle insurance. Moreover, increased developments & initiatives toward commercial auto insurance by implementing technologies such as telematics, artificial intelligence (AI), GPS, data analytics, blockchain, and big data is anticipated to provide a potential growth opportunity for the market. 

The report focuses on growth prospects, restraints, and trends of the commercial auto insurance market analysis. The study provides Porter’s five forces analysis to understand the impact of various factors such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers on the commercial auto insurance market outlook.

Segment Review

The commercial auto insurance market is segmented into distribution channel, coverage type, vehicle type, and region. By distribution channel, the market is segmented into brokers & agents, direct response, banks, and others. By coverage type, it is bifurcated into third party liability coverage and collision/comprehensive/optional coverage. Vehicle type covered in the study include light goods vehicle and heavy goods vehicle. The light goods vehicle segment is further segregated into new vehicles and used vehicles. Region-wise, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.  

The commercial auto insurance market analysis includes top companies operating in the market such as Allianz, American International Group Inc., Aon plc, Aviva, AXA, Berkshire Hathaway Inc., Chubb, Liberty Mutual Insurance Company, Willis Towers Watson, and Zurich. These players have adopted various strategies to increase their market penetration and strengthen their position in the commercial auto insurance industry.  

Commercial Auto Insurance Market
By Distribution Channel
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Direct Response segment will grow at a highest CAGR of 10.4% during 2021 - 2030.

COVID-19 Impact Analysis

The COVID-19 pandemic has a negative impact on the commercial auto insurance industry, which has further led to economic instability. Furthermore, food trucks, ice cream vans, school busses and other vehicles used commercially stopped their operations during the COVID-19 pandemic which resulted in a sharp decline in the demand for commercial auto insurance. Therefore, demand for commercial auto insurance have declined tremendously during the global health crisis. 

Top Impacting Factors

Increasing Number of Road Accidents 

There is a significant growth in demand for commercial auto insurance market due to rise in cases of accidents such as traffic collision, physical damage or bodily injury, theft, and others. Commercial auto insurance provides financial security in the form of medical injury or any other damage to the vehicle owner. In the recent years, there has been an increase in the number of road accidents, in terms of road crashes, traffic injuries, drunk driving, and distracted driving for speeding, which resulted in need for commercial auto insurance. Majority of the commercial vehicle users depend on commercial auto insurance to prevent themselves from future financial losses such as injuries to drivers, passengers, or pedestrians. This drives the growth of the commercial auto insurance market.

Commercial Auto Insurance Market
By Coverage Type
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Collision/Comprehensive/Optional Coverage Segment holds a dominant position throughout the forecast period.

Expensive Commercial Auto Insurance Policies

Commercial auto insurance premiums are an additional cost along the existing costs of maintaining a commercial vehicle, and it makes the decision to buy a commercial vehicle difficult for many people.

Moreover, for running a business in many cities and suburban areas, having a commercial vehicle is a necessity. However, vehicle owner is not able to afford a vehicle due to expensive insurance premiums. Therefore, this, is one of the major factors that hampers the market growth.  

Implementation of Technology in the Field of Commercial Auto Insurance

Increase in penetration of technologies such as GPS, telematics, artificial intelligence (AI), data analytics, blockchain, and big data is providing innovative opportunities for insurers. With these technological developments, commercial auto insurance distribution platforms are expected to enhance productivity for providing coverage seamlessly at the point-of-purchase. Moreover, digital transformation enables commercial auto insurance companies to create highly personalized user experiences to their customers. Furthermore, insurance companies rely on digital technologies for claim resolutions such as photo estimating tools and mobile telematics solutions. Thus, implementation of these technologies is expected to offer remunerative opportunities for the market growth in the upcoming years.  

Commercial Auto Insurance Market
By Region
2030
Asia-pacific 
North America
Europe
LAMEA

Asia-Pacific would exhibit the highest CAGR of 10.9% during 2021-2030

Key Benefits For Stakeholders 

  • The study provides in-depth analysis of the global commercial auto insurance market share along with current trends and future estimations to illustrate the imminent investment pockets.
  • Information about key drivers, restrains, and opportunities and their impact analysis on the global commercial auto insurance market size are provided in the report.
  • Porter’s five forces analysis illustrates the potency of buyers and suppliers operating in the commercial auto insurance market.
  • An extensive analysis of the key segments of the industry helps to understand the commercial auto insurance market trends.
  • The quantitative analysis of the global commercial auto insurance market forecast from 2021 to 2030 is provided to determine the market potential. 

Commercial Auto Insurance Market Report Highlights

Aspects Details
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By Distribution Channel
  • Brokers & Agents
  • Direct Response
  • Banks
  • Others
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By Coverage Type
  • Third Party Liability Coverage
  • Collision/Comprehensive/Optional Coverage
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By Vehicle Type
  • Light Goods Vehicle
  • New Vehicles
  • Used Vehicles
  • Heavy Goods Vehicle
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By Region
  • North America 
  • Europe 
  • Asia-Pacific 
  • LAMEA 
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Key Market Players

Berkshire Hathaway Inc., AXA, Willis Towers Watson, Aviva, Allianz, Liberty Mutual Insurance Company, Zurich, American International Group Inc., Aon plc, Chubb

Analyst Review

Commercial automobile coverage protects the company against financial consequences of accidents, injuries and fatalities involving company-owned or leased vehicles as well as employees’ vehicles when used on business. Commercial auto insurance providers are looking forward to implementing advanced technologies such as artificial intelligence (AI) and machine learning in order to enhance products and services according to vehicles used in businesses.

Increase in economic strength of the developing nations such as China and India is expected to provide lucrative opportunities for the market growth. North America occupied a major share in the auto insurance market in 2020, owing to the presence of major market players such as Allstate and Liberty Mutual Insurance Company. They are offering advanced coverage such as comprehensive, underinsured, and uninsured motorist due to the extensive adoption of heavy vehicles.

During the COVID-19 outbreak, the commercial auto insurance segment has been unprofitable for insurers and the industry collectively sustained a loss of $4 billion in commercial auto coverage in 2019, according to AM Best, which is an American credit rating agency. Also, fewer vehicles on the road increased accident severity, as drivers were emboldened to be more irresponsible on emptier roads. According to the National Safety Council, vehicle fatalities in 2020 increased by 8% from 2019 and by 24% compared to 2007. These factors have resulted into massive decline in commercial auto insurance during the pandemic situation

The commercial auto insurance market is fragmented with the presence of regional vendors such as Aon plc., Berkshire Hathaway Inc., and Willis Towers Watson. Some of the key players profiled in the commercial auto insurance market report include Allianz, American International Group Inc., Aviva, AXA, Chubb, Liberty Mutual Insurance Company, and Zurich. Major players operating in this market have witnessed significant adoption of strategies that include business expansion and partnership to reduce supply and demand gap. Major players are collaborating their product portfolio to provide differentiated and innovative products with increase in awareness & demand for commercial auto insurance across the globe.

 

Author Name(s) : Aarti Goswami| Pramod Borasi | Onkar Sumant
Frequently Asked Questions?

The Commercial Auto Insurance Market is estimated to grow at a CAGR of 9.2% from 2021 to 2030.

The Commercial Auto Insurance Market is projected to reach $307.10 billion by 2030.

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increased usage of commercial vehicles and stringent government guidelines regarding commercial auto insurance drives the market growth.However, as commercial vehicles are large in size & incur expensive maintenance, insurance premiums for these vehicles are usually higher which hamper the market growth.

The key players profiled in the report include Allianz, American International Group Inc., Aon plc., Aviva, AXA, Berkshire Hathaway Inc., Chubb, Liberty Mutual Insurance Company, Willis Towers Watson, Zurich, and many more.

On the basis of top growing big corporations, we select top 10 players.

The Commercial Auto Insurance Market is segmented into Distribution Channel, Coverage Type, Vehicle Type, and Region.

The key growth strategies of Commercial Auto Insurance market players include product portfolio expansion, mergers & acquisitions, agreements, geographical expansion, and collaborations.

Collision/Comprehensive/Optional Coverage Segment holds a dominant position throughout the forecast period.

Direct Response segment will grow at a highest CAGR of 10.4% during 2021 - 2030.

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Commercial Auto Insurance Market

Global Opportunity Analysis and Industry Forecast, 2021-2030