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The Taiwan online automotive insurance market is expected to reach a valuation of US$ 751.5 Mn by 2030 from US$ 482.6 Mn in 2022, at an estimated CAGR of 5.7% during the forecast period, 2023-2030.
As the automotive industry in Taiwan continues to grow, so too does the demand for online insurance companies. Taiwan has a booming economy and a rapidly growing middle class, both of which contribute to the increasing demand for online insurance.
There are several reasons why Taiwanese consumers are increasingly turning to online insurers. Firstly, it is convenient and easy to compare rates and coverage options from the comfort of one’s own home. Secondly, online insurers often offer lower rates than traditional insurers. And finally, many online insurers offer additional perks and benefits that appeal to Taiwanese consumers, such as cashback or rewards points. The growing demand for online automotive insurance in Taiwan is good news for insurers operating in the country. With more and more consumers turning to the internet to purchase insurance, there is a tremendous opportunity for growth in the Taiwanese market.
The Taiwanese automotive online insurance industry is growing rapidly due to a number of factors. The following are some of the top reasons why this industry is seeing such high demand:
Exit of Global Insurers from Taiwanese Automotive Insurance Market
The Taiwan online automotive insurance market is facing a significant challenge as global insurers are exiting the market due to the strict regulatory environment imposed by the Financial Supervisory Commission (FSC). The FSC's strict approach to regulating the insurance business has led to the potential sale of large life insurance businesses and has created an uncertain environment for foreign players looking to enter the Taiwanese market.
However, despite these challenges, the Taiwan online automotive insurance market still holds significant potential for growth. The increasing adoption of technology and digitalization in the insurance sector has led to a growing demand for online insurance products, including automotive insurance. Additionally, the Taiwan market has a large and rapidly growing middle class with a high disposable income, which presents a significant opportunity for businesses to tap into.
To capitalize on this potential, businesses should focus on developing innovative and cost-effective online insurance products to meet the specific needs of the Taiwanese market. They should also consider partnering with local companies to navigate the regulatory environment and gain a better understanding of the local market.
Furthermore, it's recommended for the FSC to review its stringent policies and regulations to create a more favorable environment for foreign players to enter the market, this can be done by creating a level playing field for domestic and foreign players and make sure regulations are in line with international standards. This will help to attract more foreign players to the market, increase competition and ultimately benefit the consumer with more options and better pricing.
AI in Insurance
AI is revolutionizing the online automotive insurance market. The integration of AI technology is transforming the traditional methods of insurance operations, making the process faster, more efficient and accurate. The use of AI in insurance is currently a trend in the market, it has the ability to automate various tasks such as claims processing, underwriting, fraud detection, and customer service.
This shift towards AI-powered insurance solutions is expected to bring significant benefits to both the insurers and policyholders. Insurers can expect to see cost savings, improved risk management, and increased customer satisfaction. Policyholders, on the other hand, can expect faster claims processing and personalized service. Businesses that want to stay competitive in this market should consider investing in AI technology to improve their operations and offer better products and services to their customers."
Risk Coverage Analysis
Based on risk coverage segment, the market is segmented into liability coverage, collision coverage, personal injury coverage, uninsured motorist coverage, comprehensive coverage and add-ons. The liability coverage segment dominated the market in 2022 and generated a revenue of US$ 190.1 million. On the other hand, the add-ons segment is projected to grow at the highest CAGR of 7.1% during the forecast period.
The rising demand for personal vehicles in Taiwan are compelling the car owners to purchase the automotive insurance in order to maintain road safety. The increasing traffic-related deaths each year is further propelling the market demand of liability coverage for automobiles and the demand for add-ons risk coverage during the period of 2022-2030.
Coverage Term Analysis
On the basis of coverage term, the Taiwan online automotive insurance market is classified into 1 year, 3 years, 5 years, and more than 5 years. In 2022, the one-year segment accounted for over 74% of the market share due to the high sales volume of vehicles across the nations and rising incidences of traffic accidents. Mostly insurance contracts such as one-year automobile insurance policy, may become effective any day of the year and expire after 12 months.
Distribution Channel Analysis
The Taiwan online automotive insurance market is segmented into different distribution channels, including bank, brokers/others, and insurance company webpages. According to the latest market data, the brokers segment dominates with a market share of 63.1% in 2022, driven by its ease of comparison and selection of insurance and quick availability of information. Additionally, the insurance company webpages segment is growing at a CAGR of 6.2% over the forecast period.
This trend is driven by the increasing awareness of direct contact or purchase of insurance contracts among customers, as they are able to directly buy insurance for their vehicles online. As a result, insurance companies are focusing on strengthening their online sales channels and digital marketing strategies to cater to this growing demand.
For insurance companies looking to gain a foothold in the Taiwan online automotive insurance market, it's essential to have a strong digital presence and to offer a user-friendly online platform for customers to purchase insurance. Additionally, they may consider partnering with brokers to reach a wider customer base and offer bundled insurance packages to increase customer retention and cross-selling opportunities.
Vehicle Type Analysis
By vehicle type, the Taiwan online automotive insurance market is classified into ICE vehicles, electric vehicles and hybrid. With 73% revenue share in 2022, the ICE Vehicles segment dominated the market. Moreover, due to its high rates of urbanization and population density, Taiwan has become an ideal nation for electric vehicles (EV). Electric vehicles segment is growing with a highest CAGR of 11.9% over the forecast period due to increase in adoption across the region.
Vehicle Application Analysis
In terms of vehicle application, the market is segmented into personal, commercial and off-road Vehicles. The personal segment dominated the market in 2022 and generated a revenue of $325.6 Mn. Taiwan has the highest scooter density in the world as a part of cultural heritage coupled with the excellent two-wheeler infrastructure, which makes the largest share over the forecast period. Furthermore, the off-road driving and motorcycling are popular activities among certain outdoor enthusiasts in Taiwan due to which the demand for online insurance for off-road vehicles are anticipated to grow with the highest CAGR of 6.7% during 2023-2030.
Vehicle Ownership Analysis
On the basis of vehicle ownership, the market is segmented into new vehicles and used vehicles. Used vehicles segment holds major share in the online automotive insurance market due to increasing fleet size of personal cars as well as awareness for timely maintenance and insurance of the vehicles. Whereas, the new vehicles segment is projected to grow at the highest CAGR of 7.5% during the forecast period.
End Users Analysis
In terms of end users, the market is bifurcated into individuals and businesses. The individuals segment held the highest share of 70% in 2022 and is growing at a CAGR of 5.9% during the forecast period. The individual’s segment was valued at US$350.2 million in 2022. The demand for personal vehicles includes personal, commercial and off-road vehicles that witnessed an increase over the past few years which in turn driving the demand by Taiwanese individuals.
Key Industry Players:
Fubon Insurance Co Ltd, Cathay Century Insurance Co Ltd, Mitsui Sumitomo Insurance Co., Ltd., and Tokio Marine Newa generates over 48% revenue of the Taiwan online automotive insurance market.
Other players in the Taiwan online automotive insurance market include BIDV Insurance Corporation, Chung Kuo Insurance Co. Ltd., Ho Tai Motor, Shin Kong Fire & Marine Insurance Co. Ltd, South China Insurance Co Ltd, Taian Insurance Co. Ltd. and Union Insurance among others.
List of Key Companies Profiled:
The Taiwan online automotive insurance market is sub-segmented into:
By risk coverage segment, the Taiwan online automotive insurance market is sub-segmented into:
By coverage term, the Taiwan online automotive insurance market is sub-segmented into:
By distribution channel segment, the Taiwan online automotive insurance market is sub-segmented into:
By vehicle type segment, the Taiwan online automotive insurance market is sub-segmented into:
By vehicle application segment, the Taiwan online automotive insurance market is sub-segmented into:
By vehicle ownership segment, the Taiwan online automotive insurance market is sub-segmented into:
By end user segment, the Taiwan online automotive insurance market is sub-segmented into:
The main purpose of automotive insurance is to offer financial security against property loss or bodily harm caused by accidents.
AI in insurance is the current trend in Taiwan online automotive insurance market.
The Taiwan online automotive insurance market is projected to grow at a CAGR of 5.7% during the forecast period 2023-2030 and is expected to reach US$ 751.53 Million by 2030.
Factor such as growing disposable income and increasing number of accidents and fatalities in Taiwan boost the market growth.
The add-ons segment holds highest CAGR in the Taiwan online automotive insurance market during the forecast period.
The brokers segment dominates the Taiwan online automotive insurance market in 2022.
Exit of global insurers from Taiwanese automotive insurance market restrain the market growth.
COVID-19 negatively interrupted the Taiwan automotive insurance business and with the rising concern of insurance demand the automotive insurance industry is expected to grow in the recent years.
Rising government initiatives creates a lucrative growth opportunity in the Taiwan online automotive insurance market.
The market segmentations based on vehicle ownership are new vehicles and used vehicles.
Risk coverage, coverage term, distribution channel, vehicle type, vehicle application, vehicle ownership and end users are the different segments in the Taiwan online automotive insurance market.
Some of the key players operating in the market are Fubon Insurance Co Ltd, Cathay Century Insurance Co Ltd, Mitsui Sumitomo Insurance Co., Ltd. and Tokio Marine Newa among others.