Insurance telematics solution provider aims to leverage the huge automobile market and high rate of smartphone penetration to grow usage-based insurance in the country
March 15, 2019 | Foo Boon Ping
In 2010, China overtook the US to become the largest automobile market in the world. More than 20 million new cars are registered in the country annually, and the number is estimated to have reached about 25 million in 2018, despite it being the first drop in annual new car sales in 28 years. Nevertheless, new car registration is forecasted to hit over 33 million by 2025.
Consequently, China is also the world’s largest auto insurance market. With the country’s high rate of smartphone adoption and rapid development of mobility ecosystems, it has the potential to be an attractive market for innovative products such as usage-based insurance (UBI), where policyholders pay premium according to actual usage of the vehicle and how they drive.
A recent study by PTOLEMUS, a Brussels-based research and strategy consulting firm focused on mobility, showed that the mobile UBI market has grown to 4.8 million policyholders as of the second quarter of 2018, representing almost a quarter of the total. It expects the global market for mobile UBI to expand at a compound annual growth rate (CAGR) of 39% up to 2025 to reach 60 million users, and much of that will come from Asia Pacific, and China in particular.
Not surprisingly, much of the projected growth of the global UBI market will be driven by Chinese insurers and drivers, enabled by domestic insurance technology (insurtech) and telematics solution providers.
One such technology enabler is Shanghai-based PingJia Technology (PingJia), a pioneer in the development and provision of driver behavioural analytics solutions. The company has deep automotive OEM (original equipment manufacturer) expertise and resources. It is vertically integrated within the automotive and insurance industries and is playing a leading role in the development of an international industry standard for telematics and UBI.
Jack Li Xiankun, founder and president of PingJia Technology commented: “In 2009, when most...
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, Usage-based Insurance (ubi)