Commercial Auto Insurance Market Expected to Reach $390.5 Billion by 2033

According to a new report published by Allied Market Research, titled, “Commercial Auto Insurance Market," The commercial auto insurance market was valued at $160.4 billion in 2023, and is estimated to reach $390.5 billion by 2033, growing at a CAGR of 9.1% from 2024 to 2033.

Commercial auto insurance is a policy of physical damage and liability coverage for amounts, situations, and usage not covered by a personal auto insurance policy. In addition, it provides a variety of coverage for cars, trucks, vans and other vehicles used for business purposes. Generally, large fleets and small businesses usually prefers two major coverage such as physical damage insurance and liability insurance coverage. Bodily injury liability, property damage liability, combined single limit (CSL), medical payments, no-fault or personal injury, uninsured motorist, comprehensive physical damage, and collision are some of the major commercial auto insurance coverage in the market.

Factors such as stringent government guidelines regarding commercial auto insurance industry, rise in number of road accidents, and increase in usage of commercial vehicles propel the growth of the global commercial auto insurance market trends. Furthermore, there is a rise in trends of food trucks and increase in number of vehicle owners using their personal vehicles for commercial purpose as a food truck. This, as a result requires a commercial auto insurance, since personal vehicles cannot be used for business purpose.

Furthermore, the global commercial auto insurance market size is growing exponentially in the U.S. and exhibits high growth potential due to rise in number of road accidents. For instance, according to a recent survey from National Institute of Occupational Safety & Health, 47% of commercial drivers surveyed admitted to reading text messages while driving. However, other distractions are equally dangerous with nearly 34% of drivers projected that they have fallen asleep while driving.

By distribution channel, the brokers segment has acquired a major share of the commercial auto insurance market forecast. This is primarily due to the increasing demand for customized and personalized insurance solutions tailored to the unique needs of businesses. Brokers and agents are leveraging digital platforms, websites, and online selling tools to enhance their reach and provide seamless services to clients. The ability of brokers to offer expert advice, compare multiple policies, and negotiate better terms has made them a preferred choice for businesses seeking commercial vehicle insurance. Additionally, the rise of insurtech collaborations has enabled brokers to integrate advanced technologies like AI and data analytics into their services, further improving customer experience. As businesses increasingly prioritize tailored coverage and risk management, the brokers segment is expected to maintain its dominant position in the market.

Region-wise, North America dominated the commercial auto insurance market in 2023 and is expected to maintain its leading position during the forecast period. The region's growth is driven by the expansion of the logistics and transportation sector, fueled by the e-commerce boom and the increasing need for last-mile delivery services. Commercial vehicle owners in North America are increasingly purchasing fleet insurance to cover losses from accidents, third-party injuries, and vehicle damages, which has significantly propelled market growth. Furthermore, the adoption of telematics and IoT technologies in fleet management has enhanced risk assessment and premium pricing, contributing to the market's expansion. However, Asia-Pacific is expected to grow at the highest CAGR during the forecast period. The region's rapid urbanization, increasing number of commercial vehicles, and the booming e-commerce sector are key drivers. Governments in countries like India and China are also implementing stricter insurance regulations, further boosting market growth. With the rise of electric and autonomous vehicles in the region, the demand for specialized commercial auto insurance is expected to surge, creating lucrative opportunities for insurers.

Key findings of the study

• By distribution channel, the brokers & agents segment led the highest commercial auto insurance market share, in terms of revenue in 2023.

• On the basis of coverage type, the collision/comprehensive/optional coverage segment is expected to exhibit the fastest commercial auto insurance market growth rate during the forecast period.

• Region wise, North America generated the highest revenue in 2023.  

The key players operating in the commercial auto insurance market analysis include Aviva, AXA S.A., Chubb Limited, Willis Towers Watson PLC., Berkshire Hathaway Inc., Allianz SE, Aon plc., Zurich Insurance Company Ltd., Liberty Mutual Insurance Company, American International Group Inc., Progressive Casualty Insurance Company, The Hartford, Farmers Insurance Group, Nationwide Mutual Insurance Company, Allstate Insurance Company, The Travelers Companies, Inc., The New India Assurance Company Ltd., HDFC ERGO General Insurance Company Limited, Tata AIG General Insurance Company Limited, and state farm. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.