According to a recent report published by Allied Market Research, titled, “Fire Insurance Market by Coverage, Enterprise Size and Industry Vertical: Global Opportunity Analysis and Industry Forecast, 2021–2028,” the global fire insurance market size was valued at $58.50 billion in 2019, and is projected to reach $120.49 billion by 2028, growing at a CAGR of 11.9% from 2021 to 2028.
The global fire insurance market is experiencing significant growth, and is anticipated to grow considerably in the next few years. Fire insurance is a legal deal between two parties namely, an insurance company and a policyholder. In this agreement, an insurance company guarantees that any loss or damage caused to policyholder’s property will be paid by them in the event of fire. In addition, it provides coverage against following accidents that includes accidental fire, bursting, implosion, explosion, and others. For instance, on September 24, 2020, the “National Fire Protection Association” reported an average of over 354,400 house fires each year.
Fire insurance providers have an immense potential to expand products and services in the market. Companies include floating policy, comprehensive policy, replacement policy, and others. Thus, insurers are expected to provide lucrative opportunities to innovate and expand their offerings by including specific coverage such as pay as per the risk perception. This covers the cost of the property driven by per individual rather than the average cost covered by an individual in a year. Furthermore, these coverages are provided in a combination or bundled offerings, thus making it convenient for consumers to choose specific requirements from the plans. All these factors collectively are expected to provide remunerative opportunities for product expansion in the upcoming years.
Region wise, the fire insurance market share was dominated by North America in 2019, and is expected to retain its position during the forecast period. The major factor that drives the growth of the market in this region includes presence of major players, providing additional coverage to clients and implementation of stringent government regulations toward the safety in manufacturing industries. However, Asia-Pacific is expected to witness significant growth rate during the forecast period, owing to increase in adoption of digital technologies across emerging countries and rapid increase in disposable income of the middle-class population.
The COVID-19 pandemic is expected to impact the overall economy along with the fire insurance market growth. In addition, major insurance companies are facing huge loss due to more number of people applying for coverages and less selling of insurance policies which is negatively impacting the growth of the market. However, increase in insecurity of income, employment, and restrictions in travelling across countries have led to the growth of the insurance market owing to rise in number of uncertainties in the form of lightening, fire, theft, and others. On the other hand, consecutive lockdowns, social distancing norms, stay at home strategy, and increased number of COVID-19 positive cases have decreased the demand for various safety devices such as fire extinguishers, fire detections, and alarm alerts, at home or in enterprises for protecting the physical assets from financial losses.
Key Findings Of The Study
- By coverage, the standard coverage in fire insurance market generated the highest revenue in 2019.
- By enterprise size, the large enterprise segment generated the highest revenue in 2019.
- By industry vertical, the manufacturing generated the highest revenue in 2019.
- By region, the North America fire insurance market generated the highest revenue in 2019.
The key players profiled in the fire insurance industry include Amica, Allianz, Allstate Insurance Company, AXA, ASSICURAZIONI GENERALI S.PA., GEICO, Liberty Mutual Insurance, Ping An Insurance (Group) Company of China, Ltd., State Farm Mutual Automobile Insurance Company, and USAA. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.