On-Demand Insurance Market Expected to Reach $23.7 Billion by 2032—Allied Market Research

According to a new report published by Allied Market Research, titled, “On-Demand Insurance Market," The on-demand insurance market was valued at $7.5 billion in 2022, and is estimated to reach $23.7 billion by 2032, growing at a CAGR of 12.5% from 2023 to 2032.

On-demand insurance refers to a type of insurance coverage that allows customers to purchase insurance policies for a specific period of time or for a specific activity. This type of insurance is gaining popularity in today's fast-paced, on-demand economy, where people may only need insurance coverage for a short period of time or for a specific event or activity. Examples of on-demand insurance include coverage for a single trip, a short-term rental, or a specific project or event. Thus, on-demand insurance is typically purchased and managed online, making it quick and easy for customers to get the coverage they need. 

Furthermore, major market players have undertaken various strategies to increase the competition and offer enhanced services to their customers. For instance, in December 2022, Zurich Insurance and Citi have collaborated to create and launch the Zurich Lifestyle Insurance Plan, a flexible and customizable insurance offering that is accessible via the Citi mobile app. Therefore, such strategy helps boost the growth of the on-demand insurance market. 

On the basis of coverage, the travel insurance segment is the highest growing segment. This is because there has been a rise in the on-demand travel market, which allows consumers to purchase insurance coverage for specific events or activities, such as travel. Moreover, on-demand travel insurance offers peace of mind to travelers, knowing that they are protected against unexpected events that could occur during their trip, such as trip cancellation, medical emergencies, or lost baggage.

However, the electronic equipment insurance segment is considered to be the fastest growing segment during the forecast period. This is because on-demand electronic equipment policies provide a convenient and cost-effective way for consumers to protect their valuable electronic devices. In addition, these policies can be customized to fit the specific needs of the individual, allowing them to choose the level of coverage they need for the electronic equipment and the duration of the policy. 

By region, North America attained the highest growth in 2022. This is because the market is witnessing the emergence of innovative business models such as peer-to-peer insurance, which allows individuals to pool their resources and collectively insure against risks. However, the Asia-Pacific region is considered to be the fastest growing region during the forecast period. This is because there is an increased adoption of usage-based insurance, which allows customers to pay only for the coverage they need. In addition, the Asia-Pacific region is also seeing increased collaboration between insurance companies and other industry players, such as fintech firms and ride-sharing platforms, to offer integrated and seamless insurance solutions to customers. Thus, these factors are driving the growth of the market in upcoming years.

The COVID-19 pandemic has had a significant impact on the on-demand insurance market growth. On the one hand, it has created new opportunities for growth as people seek insurance products that cover pandemic-related risks. On the other hand, it has also led to disruptions in the market as insurers struggle to adapt to changing consumer behavior and the economic fallout from the pandemic. One of the biggest impacts of COVID-19 on the on-demand insurance market trends has been the rise in demand for health and travel insurance.

Furthermore, the pandemic has also created significant challenges for insurers. As many traditional insurance providers have struggled to adapt to the rapidly changing market conditions, thus they have been forced to adjust their underwriting models and risk assessments to account for the new risks posed by the pandemic. In addition, the economic fallout from the pandemic has made it harder for many insurers to maintain profitability, as consumers have cut back on spending and businesses have reduced their insurance coverage. Moreover. despite these challenges, the on-demand insurance market share has continued to grow in popularity in the wake of the pandemic. This is because many consumers value the convenience and flexibility of on-demand insurance products, which can be purchased and managed entirely online. As a result, it is likely to see continued growth and innovation in the on-demand insurance market size in the upcoming years, as insurers continue to adapt to changing consumer needs and preferences.

Key Findings of the Study

• By end user, the individuals segment led the on-demand insurance market in terms of revenue in 2022.
• By region, North America generated the highest revenue in 2022.

The key players profiled in the on-demand insurance market analysis are AXA, Chubb, GetSafe, Metromile, Munich Re, Ping An Insurance, Root, Zurich, Zego, and Zuno. Thus, these players have adopted various strategies to increase their market penetration and strengthen their position in the on-demand insurance industry.