Extended Warranty Market Thumbnail Image

2023

Extended Warranty Market

Extended Warranty Market Size, Share, Competitive Landscape and Trend Analysis Report by Covergae (Standard Protection Plan, Accidental Protection Plan), by Distribution Channel (Manufacturers, Retailers, Others), by Application (Automobiles, Consumer Electronics, Home Appliances, Mobile Devices and PCs, Others), by End User (Individuals, Business): Global Opportunity Analysis and Industry Forecast, 2023-2032

Select an option
Author's: Kashinath Ghatke | Vineet Kumar
Publish Date:

Get Sample to Email

Extended Warranty Market Research, 2032

The global extended warranty market was valued at $129.7 billion in 2022, and is projected to reach $284.7 billion by 2032, growing at a CAGR of 8.4% from 2023 to 2032.

The extended warranty industry has experienced significant growth in recent years, driven by advancements in technology, changes in consumer behavior, and improved focus on customer experience. The extended warranty industry primarily deals with providing protection plans for various consumer goods, including electronics, appliances, vehicles, and other high-value products.

Extended Warranty Market Insights

It deals with delivering prolonged protection plans for products over and above the standard guarantee period, covering repair & replacement costs. This warranty may vary from device to device and from model to model of a particular device as different companies have different set of policies and rules. Therefore, one should carefully study the warranty card before filing a claim to ensure that the service length or cost limit is not exceeded.

Manufacturers are making extended warranty schemes more transparent in terms of duration and coverage to increase consumer loyalty. In addition, the use of AI and ML to manage questions and claims via chat, phone, and online forms drive the demand for extended warranties among businesses and people. This, in turn, fosters the market growth.

Increased awareness of extended warranty policies among consumers has led to the development of the extended warranty industry. In addition, surge in adoption of smartphones, computers, home appliances, and other products has increased the use of extended warranty coverage for the repair or replacement of parts of the expensive items, which in turn, propels the extended warranty market growth.

However, the considerable decline in shipments of personal computers (PCs) worldwide, is one of the key factors restraining the growth of the extended warranty market. On the contrary, the expansion of complex and sophisticated product and service are fostering the demand for additional warranty coverage, which is likely to pave growth opportunities for the global market. In addition, the untapped potential of emerging economies is providing lucrative opportunities for the market growth during the forecast period.

The extended warranty market is segmented based on coverage, application, distribution channel, end user, and region. By coverage, the market is bifurcated into standard protection plan and accidental protection plan. By application, the market is divided into automobiles, consumer electronics, home appliances, mobile devices & PCs, and others. By distribution channel, the market is segregated into manufacturers, retailers, and others. By end user, the market is divided into business and individuals. By region, it is analyzed across North America, Europe, Asia-Pacific and LAMEA.

Extended Warranty Market by Covergae

Depending on coverage segment, the standard protection plan segment dominated the extended warranty market share in 2022 and is expected to remain dominant during the forecast period. This is attributed to the fact that standard protection plan provides coverage for an additional two to three years of coverage against product failure. Furthermore, these extended warranty plans are mainly suitable for consumers looking for an uncomplicated usage experience and longer life for their devices. However, the accidental protection plan segment is expected to witness the highest growth in the upcoming years, owing to increase in accidental damages to consumer durable goods, along with rise in the availability of affordable accidental plans.

Extended Warranty Market by Region

Region-wise, the extended warranty market was dominated by North America in 2022 and is expected to retain its position during the forecast period, owing to increase in penetration of electronic production and the significant presence of extended warranty providers. However, Asia-Pacific is expected to witness significant growth during the forecast period, owing to the proliferation of complex and expensive consumer electronics and appliances, coupled with surge in per capita income of individuals in this region.

The report focuses on growth prospects, restraints, and trends of the extended warranty 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 extended warranty market.

The key players profiled in the extended warranty market analysis are Assurant, Inc., American International Group, Inc., AXA, AmTrust Financial, Asurion, CARCHEX, CarShield, LLC, Endurance Warranty Services, LLC, Edel Assurance, and SquareTrade, Inc. These players have adopted various strategies, including partnership, collaboration, product launch, and developments to increase their market penetration and strengthen their position in the industry.   

Competition Analysis

Recent Product Launch in the Endurance Warranty Market

On May 23, 2023, Endurance Warranty Services has expanded its suite of auto protection products to include mechanical breakdown insurance (MBI) coverage for residents of California. This new offering protects California consumers from costly repairs due to unexpected breakdowns or mechanical failures, ensuring they have the coverage they need to protect their vehicles. Endurance’s new mechanical breakdown insurance plans provide protection from the costs of repairs and parts replacement for covered components of vehicles up to 10 years old or 150,000 miles.

Recent Partnership in the Performance Bank Guarantee Market

On February 7, 2023, Okinawa Autotech in partnership with Assurant Inc., a leading global business service company, has launched Extended Warranty Program (EWP) across its entire range of electric vehicles. In addition, key powertrain components like traction motors, controllers, DCDC converters, and chargers will be covered in this warranty program.  This new program has been introduced to enhance the after-sales experience through multiple benefits. Furthermore, The program will remain valid for new customers as well as for customers who have purchased an Okinawa scooter in the last three years.

Top impacting factors

Surge in Awareness for Extended Warranty

Extended warranty provides customers with an additional layer of protection against unexpected repair costs that may arise from product defects or accidental damage. This is likely to boost the awareness for extended warranties. In addition, consumers are often concerned about the safety of their products and services post-expiry of seller’s warranty, which creates the need for insurance/warranty claim. Thus, coverage for extended warranties has surged among the individuals and business, which is expected to drive the market growth.

Numerous products have a high price tag at the time of purchase, hence awareness for extended warranty for those products has increased tremendously. According to a survey conducted by AmTrust, 51% of the respondents are aware of the extended warranty contracts. In addition, consumers are often concerned about the safety of their electronic products post expiry of seller’s warranty, which increases the coverage for extended warranty among the consumer electronics & mobile devices segment. Furthermore, increase in awareness for extended warranty, especially for used cars has increased among consumers. Current technological changes such as blockchain technology has led to innovations and new trends in the extended auto warranty industry. Moreover, providing extended warranty helps in building customer loyalty. Thus, rise in awareness for extended warranty propels the market growth.

Overall, the combination of technological advancements, increased consumer investment in high-value products, educational efforts, regulatory changes, and improved access to information has led to a notable surge in awareness for extended warranty options among consumers.  

Decline in sales of PCs  

Personal computer (PCs) is one of the major categories under consumer electronics segment, which comes with extended warranty optional coverage in the market. However, the demand for extended warranty witnessed a considerable decline, with a decline in sales of PCs in recent years. Moreover, consumer experiences and adoption of extended warranty remains a primary concern, which needs to be addressed by balancing the sales of PCs and their alternative usage in the market. Therefore, these are major factors that hamper the growth of the extended warranty market.

A decline in the sale of PCs may also lead to reduced competition in the extended warranty market. If fewer companies are offering extended warranties for PCs, consumers may have fewer options to choose from, which can lead to reduced innovation and less competitive pricing. Overall, while the decline in the sale of PCs may not completely halt the growth of global extended warranty market, it can certainly have a negative impact on the market. It is important for extended warranty providers to diversify their product offerings and find new areas of growth to offset any potential decline in the sale of PCs. Therefore, these factors limit the growth of the extended warranty market around the world.

Expansion of Products and Services 

The expansion of products and services in the consumer electronics industry is indeed creating opportunities for the extended warranty market. Surge in need for extended warranty protection owing to the increasing demand for consumer electronics such as smartphones, laptops, and other smart devices is expected to create an opportunity for market growth. Moreover, with the rise of e-commerce and online sales, consumers are increasingly purchasing consumer electronics online, making it more difficult to get in-person technical support and assistance. Extended warranties provide consumers with peace of mind and convenient access to repair and technical support services, reducing the hassle and costs associated with product repairs. These aforementioned trends in the expansion of products and services are expected to fuel the lucrative opportunities in the market.

In addition, the agreement & partnerships are further anticipated to boost the manufacturers & retailers to gain confidence of buyers and support their profit margins. For instance, in February 2023, Okinawa Autotech, in partnership with Assurant, rolled-out an extended warranty program (EWP) across its entire range of electric vehicles and car warranty. This program aim at improving the after-sales experience through multiple benefits. Such strategic initiatives are providing novel opportunities to boost the market growth during the forecast period. Furthermore, the growth of the sharing economy, with the proliferation of short-term rentals and co-living spaces, has also led to an increased demand for extended warranties. Overall, the expansion of products and services in electronic and automobile segment is creating opportunities for the extended warranty market, as consumers increasingly seek protection and peace of mind for their valuable devices.

Key Benefits for Stakeholders

  • This report provides a quantitative analysis of the extended warranty market size, segments, current trends, estimations, and dynamics of the extended warranty market forecast from 2023 to 2032 to identify the prevailing extended warranty market opportunities.
  • The market research is offered along with information related to key drivers, restraints, and opportunities.
  • Porter's five forces analysis highlights the potency of buyers and suppliers to enable stakeholders make profit-oriented business decisions and strengthen their supplier-buyer network.
  • In-depth analysis of the extended warranty market segmentation assists to determine the prevailing extended warranty market opportunity.
  • Major countries in each region are mapped according to their revenue contribution to the extended warranty insurance.
  • Market player positioning facilitates benchmarking and provides a clear understanding of the present position of the market players.
  • The report includes the extended warranty market outlook of the regional as well as global extended warranty market trends, key players, market segments, application areas, and market growth strategies.

Extended Warranty Market Report Highlights

Aspects Details
Market Size By 2032
Market Size By 2032

USD 284.7 billion

Growth Rate
Growth Rate

CAGR of 8.4%

Forecast period
Forecast period

2022 - 2032

Report Pages
Report Pages

282

Extended Warranty Market By Covergae
By Covergae
  • Standard Protection Plan
  • Accidental Protection Plan
Extended Warranty Market By Distribution Channel
By Distribution Channel
  • Manufacturers
  • Retailers
  • Others
Extended Warranty Market By Application
By Application
  • Automobiles
  • Consumer Electronics
  • Home Appliances
  • Mobile Devices and PCs
  • Others
Extended Warranty Market By End User
By End User
  • Individuals
  • Business
Extended Warranty Market By Region
By Region
  • North America  (U.S., Canada)
  • Europe  (Germany, UK, France, Italy, Spain, Netherlands, Rest of Europe)
  • Asia-Pacific  (China, Japan, India, Australia, South Korea, Rest of Asia-Pacific)
  • LAMEA  (Latin America, Middle East, Africa)
Key Market Players
Key Market Players

American International Group, Inc., Asurion, CARCHEX, Edel Assurance, Assurant, Inc., CarShield, SquareTrade, Inc., AXA, Endurance Warranty Services, LLC, AmTrust Financial

Analyst Review

In accordance with several interviews conducted of the top level CXOs executives, the adoption of extended warranty has increased in last few years, due to the growing number of extended warranty providers that help consumers to acquire long-term product security. In addition, the proliferation of complex and expensive consumer electronics and appliances has increased the utility for extended warranty protection, which is expected to drive the growth of the market.

In addition to this, the supply side of the extended warranty market is driven by the expansion of e-commerce. The ease of online price comparison has compressed retail margins, creating a need for online and brick-and-mortar merchants to augment revenue and boost profitability by selling extended warranties.

Moreover, key players in the extended warranty market such as AmTrust Financial, Assurant, and AXA, account for a significant share of the market, followed by some other top vendors in the local and regional markets. With larger requirements for warranty services, companies introduced various strategies to strengthen their market position capabilities. For instance, in February 2021, AXA Affin General Insurance launched Business Advantage Plus (Enhanced), or BAPE, a business protection plan for SMEs. The policy covers fire and other insured perils, such as burglary, public liability, and workmen’s compensation. Such strategic initiatives by the market players are expected to contribute to significant growth of the extended warranty market across the globe.

Moreover, market players have expanded their business operations and geographical footprint by making strategic collaboration and partnerships. For instance, in February 2023, AmTrust Financial Services, Inc., a global specialty property casualty insurer, expanded its international extended warranty and protection business in South Korea. AmTrust writes policies for leading automotive, electronics, equipment manufacturers and retailers. In addition, the automobile and electronic vendors are providing a range of extended warranty services to their customers.

For instance, in June 2023, Honda Motorcycle and Scooter India unveiled a new program, Extended Warranty Plus (EW Plus), for its models up to 250cc that provides warranty coverage for up to 10 years, among other benefits. These aforementioned strategic advancements propel the growth of the extended warranty market.

Author Name(s) : Kashinath Ghatke | Vineet Kumar
Frequently Asked Questions?

The extended warranty market is estimated to grow at a CAGR of 8.4% from 2023 to 2032.

The extended warranty market is projected to reach $284.70 billion by 2032.

The extended warranty market is expected to witness notable growth owing to surge in awareness for extended warranty and rise in penetration of laptops, smartphones, and tablets.

The key players profiled in the report include Assurant, Inc., American International Group, Inc., AXA, AmTrust Financial, Asurion, CARCHEX, CarShield, LLC, Endurance Warranty Services, LLC, Edel Assurance, and SquareTrade, Inc.

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

Loading Table Of Content...

Loading Research Methodology...

Individual sections of the reports are available for purchase.
Would you like to see a breakdown of prices by section?

Extended Warranty Market

Global Opportunity Analysis and Industry Forecast, 2023-2032