What is the Future of Home Insurance Market?
The global home insurance market is estimated to grow over 7.3% by 2028 which makes its future consistent and secure. Technological advancements like AI, data analytics, blockchain, etc. provides imminent opportunities for home insurers in the market. Furthermore, digital advancements have substantially helped home insurance companies to provide a better personalized experience for their customers.
The home insurance market has seen a consistent growth in the past few years due to people’s increasing concerns over the irregular climatic changes, natural calamities, protests, riots and other unfortunate events around the world. Therefore, it became vital for people to take certain measures in order to keep their families safe by insuring their home or properties. The global home insurance market is estimated to grow over $4,07,940.4 million by the end of 2028, having a CAGR of 6.8%.
What is Home Insurance?
It refers to the property insurance that provides financial immunity to a person against any losses or damages made to the property. Depending on the schemes, policies, terms, and conditions of the insurance, it may cover interior and exterior damage, loss or any damage to personal assets, any grave injury while being on the property, or any loss due to natural disaster like floods, tsunami, earthquake, etc. Generally, these events or more popularly known as acts of God are exempted from the standard home insurance policies, but exceptions can be made in case of people living in areas more prone to the natural disasters like Japan.
Why is Home Insurance Envisioned to Witness Popularity?
According to a research conducted by research dive, the home insurance market is set to garner significant growth in the coming years. Rapid urbanization is one of the major aspects to accelerate the growth rate of home insurance market worldwide. It is estimated that by the year 2050, about 70% of the global population will be in living in cities, and therefore the reach of home insurance market is increasing day by day. Urbanization has led to the large-scale construction of buildings, towers, and offices due to the expanding population to meet the people’s demands for their enhanced standard of living. Therefore, more and more inhabitants tend to keep their homes insured in order to maintain security against the most unfortunate of events.
Insurance has become a kind of necessity among people to get their most valuable assets insured, house being one of them. Therefore, the customers are inclined towards insurers providing a seamless experience along with a degree of customized service. Governments of various nations have also taken remarkable initiatives to facilitate residential establishments in their respective countries, providing better and affordable homes for underprivileged people by allocating enhanced household facilities. This further added to their overall market development.
In order to meet the needs and demands of people around the world, substantial quantity of resources is being exploited everyday leading to environmental degradation. This environmental degradation leads to irregular climatic conditions around the globe, and thus leading to extreme conditions and disasters. Man-made disasters like nuclear explosion, chemical gas leaks, structural failures, etc. has also created expansive havoc around the areas. Thus, these accidents and disasters made it vital for people to keep their homes insured which further favored the growth the global insurance market.
Impact of COVID-19 on Home Insurance Market
The unprecedented advent of COVID-19 has created an intense commotion affecting the economy and millions of people around the world. Thus, the economic instability is still prevalent in many countries affecting the home insurance market. The entire insurance industry has lost about 50% of its market share since the emergence of the pandemic, car and home insurance being the most affected segment of the business. Furthermore, unemployment and other income related issues have unusually stalled the home buying decisions for various citizens worldwide.
Therefore, the demand for home insurance has consequently reduced due to the economic and financial instability among people. But the home insurers can make the best out of this situation by offering better customized services and offers to further widen their market reach among people. Furthermore, since urbanization is on a roll, construction of buildings is hardly going to stop, and thus making insurance a vital aspect for people while buying homes.
Key Players in the Global Home Insurance Market
- Admiral Group Plc,
- American International Group, Inc.
- Allstate Insurance Company
- State Farm Mutual Automobile Insurance Company
- Liberty Mutual Insurance
- Nationwide Mutual Insurance Company
- The Travelers Indemnity Company.
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