Usage-based Insurance (UBI) Market to Record rise in Demand Owing to Increasing End use Adoption 2022-2027
Category: #business  By Rahul Varpe  Date: 2022-11-22
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Usage-based Insurance (UBI) Market to Record rise in Demand Owing to Increasing End use Adoption 2022-2027

The usage-based insurance market is expected to observe remunerative growth by 2027, fuelled by the increasing adoption of black box technology, rising commercial vehicle sales, and widescale adoption of telematics solutions. UBI or usage-based insurance, also referred to as pay-as-you-go; pay-as-you-drive; and pay-per-mile; is a kind of auto insurance that, depending on the specific plans of the insurer, could measure how far a vehicle is driven, and where it is driven.

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UBI is frequently powered by telematics, basically a technology which is pre-installed in the network of car or is available in vehicles utilizing a plug-in device but could also be available through smart phone applications. It also provided insurers a broad range of data, from how drivers are accelerating and braking to their speeds, which location they are driving, as well as for how long they are behind the wheel.

The usage-based insurance (UBI) market is bifurcated in terms of package type, technology, vehicle type and regional landscape.

With respect to technology, the market for usage-based insurance is categorized into embedded telematics, smartphone, black box, and OBD-II. In 2020, the black box segment held the market share of more than 25% and is anticipated to witness similar growth patterns over the coming period. The speed benefits offered by black box will aid towards industry growth.

Black box, which is a fixed electronic device, securely mounted in the vehicle ensures that exact trip, and in case of accidents, collision data is recorded and transmitted to a data center. Telematics or black boxes usually record the way a vehicle is being driven, its acceleration, its speed, as well as its braking.

The system uses accelerometers, GPS, along with other on-board diagnostics to perform these tasks. This information can be sent wirelessly to insurance firms in real-time, who could then effectively reward drivers with very low premiums in return for safer driving.

On the regional front, the LAMEA is projected to show around 20% CAGR through the analysis timeline. Rising number of commercial vehicles in the region will enhance the UBI market share in LAMEA.

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The entry of novel participants in Middle East market will augment the overall market for UBI. At the GITEX Global 2020, Navtelecom, entered the Middle East market for telematics. The firm showcased the flagship tracking devices, namely the SMART S-243X and SMART S-242X.

These new trackers can be utilized in fleet management, public transport, agriculture, transportation among others. Both these trackers work with all kinds of fuel sensors. Here, the SMART S-242X is well-suited with CAN-bus reader, Bluetooth headset and temperature sensors.

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About Author

Rahul Varpe

Rahul Varpe    

Rahul Varpe currently writes for Technology Magazine. A communication Engineering graduate by education, Rahul started his journey in as a freelancer writer along with regular jobs. Rahul has a prior experience in writing as well as marketing of services and products ...

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