Global Motor Insurance Market Growth: AI and Telematics Leading Change

The global motor insurance market is poised for significant growth, with premiums expected to rise steadily over the next five years. According to CoinLaw's latest report, the sector is projected to attain a valuation of $2.13 trillion by 2026 and could further expand to $2.86 trillion by 2031, reflecting a compound annual growth rate (CAGR) of 6.05%.

Parallel market analysis indicates that the motor insurance sector, valued at $976.1 billion in 2025, is forecasted to grow to $1.75 trillion by 2034. This progression is driven by a CAGR of 6.70% from 2026 onward. Simultaneously, there is an increasing reliance on artificial intelligence in insurance operations, with AI being extensively utilized in underwriting and claims processes. The global AI insurance market is anticipated to generate $26.3 billion in revenue this year, with projections to reach $114.52 billion by 2031, signifying a robust 34.2% CAGR.

AI-driven virtual agents and chatbots have become integral to managing initial claims-related inquiries, handling between 60% and 80% of customer interactions. Additionally, the rise of telematics technology is accelerating the growth of usage-based insurance, which is expected to reach about $243.32 billion by 2030, growing at a CAGR of 23.1%. These developments highlight a transformative phase for the insurance industry, characterized by technological innovation and evolving market strategies.