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Home Insurance Market

Home Insurance Market: Information by Coverage (Comprehensive Coverage, Dwelling Coverage, Content Coverage), End-User (Landlords and Tenants), and Region — Forecast till 2030

Published At : 11 Aug, 2022
Updated At : 12 Aug, 2022
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Market Snapshot
Base Year:
2021
Study Period:
2020-2030
CAGR:
7.3 %
Fastest Growing Market:
Europe
Largest Market:
North America

The global home insurance market had a share of USD 237.7 billion, which is estimated to project with a CAGR of 7.3% and reach USD 417.66 billion during the forecast period. Home insurance provides financial protection against damages and losses to a person's residence, furniture, and other valuables. In addition to providing liability coverage for accidents at home or on the property, homeowner's insurance also offers coverage for injuries sustained by third parties. It is a package policy; thus, it covers both property damage and liability, or legal obligation, for any accidents and property destruction customers or their families cause to others. A Home Insurance policy covers the home against physical damage and the contents of the home.

Additionally, theft and burglary are covered by comprehensive Home Insurance coverage. Given that most households have a lot of valuables, it is sensible to purchase insurance covering these goods. In addition to providing risk coverage for damage to the home, these homeowner's insurance policies also assist policyholders with property-related legal procedures and duties. In addition, house insurance will cover losses and damages typically resulting from natural disasters and/or man-made mishaps.

The growth of the global number of households, the expansion of government programs, and the increase in catastrophes and man-made disasters are the primary drivers driving the expansion of the global home insurance industry. However, a lack of information about home insurance policies hinders market expansion. During the forecast period, the latent potential of emerging economies and new technological advances in the home insurance business is anticipated to present profitable opportunities for global home insurance market expansion. In addition, home insurance providers envisage implementing cutting-edge technology such as artificial intelligence (AI) and machine learning to monitor leases and make appropriate judgments. Moreover, internet channels have shifted customer habits and preferences concerning buying home insurance. Consequently, home insurance providers have significant chances to reinvent their existing channels and increase their product offerings in emerging nations' untapped potential.

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Market Dynamics

Global Home Insurance Market Drivers

The Rise in Number of Catastrophes and Hazards

Increased demand for home insurance on incidents like interior or exterior home damage, damage to assets or injury, theft, and fire, puts a strain on insurance investors to expand and develop products with low proliferation, high coverage, and financial security in the form of medical injury or other damages. There has been an increment in the incidences of natural disasters in recent years, such as floods, earthquakes, vandalism, and landslides, increasing the need for home insurance. Most homeowners rely on home insurance to safeguard against future financial losses, such as harm to third-party assets, family members, and pets. In addition, home insurance includes this coverage, which helps reimburse the policyholder's family after death.

Innovative Services Offered by Home Insurance Companies

Diverse insurance firms worldwide are implementing innovative techniques to boost their market value, increase revenue, and improve the client experience. Accordingly, some home insurance firms provided their customers with applications and other technologically advanced services to keep them safe throughout the epidemic. For example, Allstate Insurance Company assisted its customers by launching a new Shelter-in-Place Payback program that enabled consumers to claim approximately USD 1 billion in insurance benefits. The Real Estate Regulatory Authority, also called RERA, launched a program to raise awareness of home insurance among citizens in conjunction with its ambitious ambition to build 20 million dwellings in urban areas and 40 million houses in rural regions by 2022. Consequently, such innovative new services have become a prominent trend in the home insurance sector, stimulating the expansion of the global home insurance market.

Global Home Insurance Market Restraints

Lack of Knowledge Regarding Home Insurance Policies

A significant element restraining the growth of the home insurance market is a lack of understanding and awareness regarding home insurance coverage. Consumer experiences and acceptance of home insurance are essential concerns that must be addressed by closing global market knowledge gaps. According to a poll by the Insurance Information Institute in 2020, 49% of respondents were unaware that house insurance policies provide health insurance coverage. In addition, several obstacles, such as customers' misunderstanding of premium rates and a lack of awareness about home insurance in Asia-Pacific emerging nations, hinder the expansion of the global market.

Global Home Insurance Market Opportunities

Raised Demand for Liability Coverage in Some Economies

Providers of home insurance have a tremendous opportunity to enhance their market presence. In addition, various businesses offer third-party liability coverage, comprehensive coverage, bodily & property damage coverage, and medical coverage for third parties, creating a potential market opportunity for home insurance. Insurers are now increasing their policies to include coverage for identity theft, dog attacks, and neighborhood damage in addition to property damage claims, personal damage claims, fire, and other related claims. Moreover, such coverage is supplied in combination or packaged solutions, making it easy for consumers to select specific needs from the available plans. In the years coming, it is estimated that these variables will jointly create lucrative chances for product expansion.

 

Segmental Analysis

The global home insurance market is classified based on coverage, end-user, and region.

By Coverage

Based on coverage, the segmentation includes comprehensive coverage, dwelling coverage, content coverage, and other optional coverage. 

The segment of comprehensive coverage is expected to hold the largest market share with a CAGR of 6.8% during the forecast period. Comprehensive insurance protects policyholders to replace or restore their home belongings if they are stolen or damaged in an accident. Comprehensive coverage includes protection against fire, vandalism, and natural disasters. It is necessary for both leased and mortgaged properties. Maximum protection makes the rate of a comprehensive policy several times that of a conventional policy. As damage claims are more prevalent than third-party claims, it is projected that acceptance of comprehensive coverage will increase during the forecast period as it considers the damage cost to the home's actual cash worth and offers financial protection against non-accident-related claims.

The second-largest share will be held by content coverage. Content insurance is also known as personal property coverage. This segment is anticipated to grow considerably in the coming years as it provides financial protection against stand-alone goods and is suited for homeowners and renters in movable items. In addition, it provides financial assistance to replace or repair stolen or damaged personal property, such as that caused by a covered risk like a fire.

By End-User

Based on end-user, the segmentation includes landlords and tenants.

Landlords are expected to have the largest share with a CAGR of 7% during the forecast period. Landlord insurance is a policy that safeguards landlords against hazards linked with rental properties. It often consists of buildings and contents insurance and landlord-specific coverages such as property owners' liability, loss of rent, and tenant default insurance. Renting has shown to be a viable alternative because it provides consumers with adequate financial protection against their medical bills, injuries, and other expenses. In addition, it gains the right to use the land without incurring substantial outlays of cash upfront. According to the HomeLet Residential Index, rentals increased by 1.5% in 2020; landlords are currently in a solid position to secure their homes. Therefore, such global changes fuel the expansion of the global house insurance market.

Tenants insurance is a type of property insurance that provides policyholders with financial protection for their possessions, responsibilities, and further living expenses in the event of a loss. It is provided to anyone who pays rent. This coverage covers the tenant's personal belongings within the rented property from damage.

 

Regional Analysis

The regional segmentation of the global home insurance market includes North America, Europe, Asia-Pacific, and LAMEA.

North America And Europe Are Expected To Dominate The Regional Market

Home Insurance Market Regional Analysis

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North America will command the market with the largest share growing with a CAGR of 6% during the forecast period. People's increasing awareness of the benefits of home insurance and favorable government regulations about home insurance, which encourage market expansion, have contributed to the rise of the home insurance sector. Home insurance has been a big part of the North American economy for almost years. In addition, the rapid spread of the COVID-19 pandemic also raised the need for home insurance in the United States. According to ValuePenguin, home insurance rates in the United States got nearly 47% more than they were a decade ago, as 81% of Americans regard home insurance as necessary insurance that protects an individual's lifetime investment.

Europe will hold the second-largest share of USD 141.3 billion with a CAGR of 6.9%. Due to significant market participants in Europe, this area has experienced tremendous growth. Due to the loss incurred during the COVID-19 outbreak, home insurance service providers in this region concentrated on expanding their revenue, which raised the demand for home insurance in the region. The property & casualty insurance industry plays a crucial part in the economic expansion of Europe, as this sector is responsible for creating significant employment possibilities in numerous European nations.

In addition, since the advent of the pandemic, the home insurance business has experienced long-lasting favorable effects. In addition, the increasing number of households and the recent increase in rental housing have increased the desire for home insurance among the general public, which benefits the home insurance market growth. In addition, the escalating number of accidents occurring in various European households and the growing desire to avoid accident-related losses significantly enhance the need for home insurance in this region.

Asia-Pacific will grow at the fastest growing CAGR during the forecast period. Increasing building and manufacturing activity are the primary factor driving the growth of the Asia-Pacific home insurance market. In addition, the governments of numerous nations, including China, Japan, Malaysia, Australia, and Thailand, are focusing on drafting policies that encourage infrastructure investment, thereby creating excellent potential for the industry in this region. The introduction of new market tactics by home insurance companies to increase their market share in Asia-growing Pacific nations contributes to the industry's expansion. In addition, the market expansion is fueled by the leading industry players in this region adopting sophisticated technologies to increase their revenue prospects.

 

Players of the Market

  • Allstate Insurance Company
  • ALLIANZ GROUP
  • ADMIRAL
  • AXA
  • Allstate Corporation
  • Chubb
  • Liberty Mutual Insurance
  • People's Insurance Company of China Group
  • State Farm Mutual Automobile Insurance
  • Zurich Insurance Co. Limited

 

Recent Developments

  • In 2022, ALLIANZ GROUP agreed to sell a majority stake in its Russian operations to Interholding LLC. 
  • In 2022, ALLIANZ GROUP announced that it had entered into a memorandum of understanding with Voya Financial relating to a strategic partnership.
  • In 2022, Liberty Mutual Insurance completed the acquisition of State Auto Group.

 

Global Home Insurance Market: Segmentation

By Coverage

  • Comprehensive Coverage
  • Dwelling Coverage
  • Content Coverage
  • Other Optional Coverage

By End-User

  • Landlords 
  • Tenants

By Region

  • North America
  • Europe
  • Asia-Pacific
  • LAMEA
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