This number is expected to grow at a compound annual growth rate (CAGR) of 8.9 percent to reach 20.7 million by 2027. In North America, the number of insurance telematics policies in force is expected to grow at a CAGR of 11.7 percent from 16.8 million in Q4 2022 to 29.2 million in 2027.
The US, Italy, the UK and Canada remain the largest markets in terms of insurance telematics policies. In North America, the market is dominated by Progressive, Allstate, Liberty Mutual, Nationwide and State Farm in the US, and Intact Financial Corporation and Desjardins in Canada. Italian insurers UnipolSai and Generali together account for around 50 per cent of telematics-enabled policies in Europe. Other insurers with high penetration in the UK include the Admiral Group and Direct Line.
The European insurance telematics market is largely dominated by aftermarket black boxes, while mobile applications, followed by self-installed OBD devices, account for the vast majority of active policies in North America. Berg Insight expects the adoption of smartphone-based solutions to continue to grow in all markets, as well as an increase in the use of OEM telematics data in usage-based insurance programmes.
The insurance telematics value chain spans multiple industries, including a large ecosystem of companies that extend well beyond insurance industry players.
“Automotive OEMs such as Ford, General Motors, Mercedes-Benz, Stellantis, Tesla and Toyota have all launched solutions to enable usage-based insurance for their customers,” says Caspar Jansson, IoT analyst at Berg Insight.
Connected car applications are bringing OEMs closer to drivers, and players such as LexisNexis Risk Solutions, Verisk and CCC Information Services are partnering with OEMs and normalising connected car data in telematics exchanges, allowing insurers to use telematics data from a variety of sources as long as policyholders agree to share their driving data.
Aftermarket telematics continues to play an important role in the usage-based insurance market. Octo Telematics has a dominant market share with more than 5.7 million devices installed in insurance telematics programmes. Other end-to-end solution providers such as Vodafone Automotive, Viasat Group, Targa Telematics, IMS and The Floow are also important players in the insurance telematics market.
