Two-wheeler/motorcycles Insurance Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

Global Two-Wheeler/Motorcycles Insurance Market Trends and Insights

Mandatory insurance requirements & rising two-wheeler parc

Indonesia’s Financial Services Authority (OJK) has made third-party liability compulsory for all motor vehicles from January 2025, instantly expanding the addressable base for carriers^{[1]Financial Services Authority, “Regulation on Compulsory Motor Vehicle Liability Insurance,” ojk.go.id}. Similar frameworks in Thailand and India consolidate a predictable premium pool, enabling insurers to allocate capital to product innovation and digital outreach. Motorbike density in congested megacities continues to climb, reinforcing steady policy growth as commuters seek agile mobility and regulators pursue safer roads. In India, opening the insurance sector to 100% foreign direct investment attracts global expertise and capital^{[2]Bajaj Finserv, “Revised Motor Third-Party Premiums Effective 2025,” bajajfinserv.in}. Collectively, these levers underpin a stable growth runway for the two-wheeler/motorcycle insurance market. 

Escalating repair/medical costs

Modern two-wheelers increasingly feature sensors, connectivity modules, and advanced safety electronics. Component complexity drives parts inflation well above headline CPI, while technician shortages lengthen repair cycles. LexisNexis reported 35% and 40% jumps in bodily injury and collision severity, respectively, trends that filter directly into motorcycle claims. Concurrently, medical cost inflation amplifies loss ratios, giving carriers a strong rationale to refine underwriting granularity and push telematics-based incentives for safer riding. These pressures also encourage closer collaboration between insurers and OEMs to monitor vehicle health and rider behavior in real time. As claims costs mount, actuarial models are being recalibrated to better reflect the risk dynamics of digitally enhanced motorcycles. 

Rapid motorcycle sales growth in Asia-Pacific and South America

Urban households across Southeast Asia and South America continue to adopt motorcycles for cost-effective last-mile mobility. App-based ride-hailing platforms formalize informal “mototaxi” segments and require embedded coverage at dispatch, channeling previously uninsured riders into the formal risk pool. Government purchase incentives and expanding charging networks spur electric motorbike uptake, further enlarging policy demand in the two-wheeler/motorcycle insurance market. This transition is particularly pronounced in dense urban corridors, where two-wheelers offer a practical alternative to congested public transport. As fleets electrify, insurers are adapting products to cover battery degradation, charging infrastructure liability, and new maintenance risk profiles. Additionally, digital distribution and micro-premium models are being scaled to align with the affordability needs of gig workers and low-income riders. 

Usage-based/telematics premium models

InsurTech innovators convert aggregated ride data into dynamic pricing. VOOM’s per-mile product, backed by a USD 15 million funding round, allows infrequent riders to cut premiums by up to 60% while preserving coverage^{[3]VOOM Insurance, “Series A Funding Announcement,” voominsurance.com}. Cambridge Mobile Telematics reports a 20% drop in distracted riding and a 27% fall in speeding among highly engaged users, demonstrating tangible risk mitigation. Behavioral benefits loop back into reduced claims, supporting profitable growth. These models reward safer riding habits in real time, strengthening the feedback loop between user behavior and financial incentives. As adoption spreads, insurers gain access to granular risk profiles that enhance underwriting precision across diverse geographies. This data-centric approach is especially impactful in emerging markets, where traditional credit or claims histories are often lacking. Moreover, embedded sensors and smartphone integrations reduce barriers to telematics adoption, enabling wider rollout at scale. 

Complex multi-jurisdiction regulation & solvency rules

Capital models vary widely across continents, compelling global insurers to maintain parallel compliance regimes. The NAIC’s 2025 risk-based capital framework revision in the United States adds extra reporting layers. Concurrently, Europe’s Solvency II update forces asset-liability adjustments, while the UAE shifts oversight to its central bank. Smaller players face the stiffest overhead, limiting their expansion bandwidth. These divergent regulatory landscapes increase administrative costs and complicate cross-border capital allocation. Larger insurers may absorb these costs through scale, but mid-sized players often struggle to justify new market entries. Additionally, misaligned solvency ratios across jurisdictions can distort reinsurance structures and delay group-level risk transfer. Regulatory harmonization remains limited, prompting insurers to rely heavily on localized compliance teams and specialized legal counsel. 

Rising climate-related catastrophe losses

Extreme weather events damage motorcycles at scale and heighten rider accident risk. Global reinsurers note an upward trend in both severity and frequency of climate-driven events, prompting higher catastrophe loads and reinsurance spend. Carriers respond with stricter geographic underwriting guidelines, but elevated costs suppress policy affordability in exposed regions. This dynamic is particularly acute in flood-prone Southeast Asia and wildfire-affected parts of Southern Europe and California. Loss predictability remains low due to shifting climate baselines, challenging traditional actuarial models. As a result, some insurers are withdrawing from high-risk zones altogether or imposing sub-limits on natural catastrophe claims. These trends also accelerate interest in parametric insurance models, offering quicker payouts tied to measurable weather triggers. However, product awareness and regulatory alignment for such innovations remain limited in many developing markets. 

Segment Analysis

By Policy Type: Comprehensive coverage gains momentum

Third-party liability remained the backbone of the two-wheeler/motorcycle insurance market in 2024, owning 55.4% revenue share as statutory mandates fuel compulsory take-up. Comprehensive policies, however, are forecast to log a 6.22% CAGR, the quickest among all policy classes, as rising household income and higher-value electric bikes encourage riders to protect their assets fully. The two-wheeler/motorcycle insurance market size for comprehensive coverage is projected to widen significantly between 2025 and 2030, benefiting carriers with diversified product suites. Collision and specialty add-ons, such as gap or battery warranty coverage, cater to niche needs, especially in urban centers where parking accidents and theft remain prevalent. 

Growing comprehensive adoption also mirrors technological progress in claims handling. Allianz has embedded generative AI across nearly 400 use cases to shorten settlement cycles, making broad coverage more palatable to cost-conscious riders. Electric bike owners are particularly receptive, as battery packs can represent more than half of vehicle value; a standalone battery replacement endorsement is therefore fast becoming a standard feature in comprehensive bundles. 

Note: Segment shares of all individual segments available upon report purchase

By Distribution Channel: Digital transformation accelerates

Direct-to-consumer accounted for 35.70% of 2024 premiums and is projected to expand at a 6.81% CAGR, reflecting the structural pivot to online self-service and app-led policy management. The two-wheeler/motorcycle insurance market size captured by embedded flows is rising in tandem, underpinned by OEM webstores, neo-banks and ride-sharing apps integrating instant cover. Intermediated models retain a meaningful presence for complex risk consultations, but their growth pace trails fully digital competitors. As younger, tech-savvy riders dominate new policy origination, demand for 24/7 self-service features, real-time quotes, and in-app claims tracking is accelerating. Digital-first insurers are also leveraging behavioral data from embedded platforms to personalize pricing, further widening the gap from traditional agents. 

The two-wheeler/motorcycle insurance market benefits from hybrid experiments, such as Bajaj Allianz’s bancassurance rollout through Axis Bank’s branches, which blends in-person advice with a digital backbone. For players, online origination slashes distribution expense ratios, enabling sharper price points that resonate with price-sensitive riders. This structural gain is expected to sustain margin expansion even as loss of costs rise. Additionally, hybrid models serve as a transition bridge for underbanked and digitally hesitant customers, expanding reach without sacrificing efficiency. As trust in digital channels improves, many of these hybrid-acquired customers eventually migrate toward fully digital servicing, supporting long-term retention. 

By Vehicle Propulsion: Electric transition creates premium challenges

Internal combustion engine models still held 85.45% of 2024 premium volume, but battery-powered two-wheelers led growth with an 8.21% CAGR. High battery replacement expense and limited repair networks inflate electric motorbike premiums around 20% above conventional rates, yet government incentives and zero-emission zones underpin robust sales trajectories. The two-wheeler/motorcycle insurance market share for electric bikes is therefore set to climb steadily through 2030. As urban congestion charges and carbon taxes expand, more commuters are shifting toward e-mobility solutions despite higher initial insurance costs. Insurers are beginning to pilot tailored products for EV two-wheelers, incorporating coverage for charging infrastructure and software vulnerabilities. 

Munich Re’s “Cyber for Auto” cover, launched in 2024, addresses new digital risks tied to connected powertrains and over-the-air updates. As carriers refine experience curves on battery degradation and parts sourcing, underwriters expect gradual premium normalization, which could unlock even faster adoption in price-sensitive economies. This normalization will also benefit shared mobility operators, where fleet electrification is a strategic priority. With growing exposure to digital threats, reinsurers are actively exploring bundled cyber and property-risk products specifically designed for connected electric motorcycles. 

Note: Segment shares of all individual segments available upon report purchase

Geography Analysis

Asia Pacific delivered 38.6% of global premiums in 2024 and is tracking a 5.42% CAGR to 2030 as regulators standardize compulsory insurance and urban commuters favor two-wheelers for cost-efficient mobility. India’s 100% foreign direct investment allowance already spurred Zurich’s USD 670 million purchase of a majority stake in Kotak General Insurance, highlighting capital inflow momentum. Indonesia’s mandate is expected to formalize millions of riders, broadening the two-wheeler/motorcycle insurance market base across ASEAN. 

North America is mature but remains technology-driven. Carriers dominate UBI penetration; LexisNexis estimates that over 68% of U.S. insurers see telematics as a decisive competitive lever. Progressive’s data-centric model helped lift its motor share to 16.73% in 2024, showing that even saturated markets permit share shifts through analytics excellence. However, wildfire-related losses in the West and hurricane clusters in the Gulf continue to inject volatility into combined ratios. 

Europe’s market benefits from capital efficiency under Solvency II. Allianz reported EUR 44.8 billion in property-and-casualty volume for H1 2024, up 7.3%, confirming disciplined rate adequacy. Electric mobility regulations in Germany, France and the Nordics foster electric bike penetration, broadening policy demand. Conversely, Brexit-related licensing adjustments moderately raise frictional costs for U.K. domiciled underwriters active in continental territories. 

South America and the Middle East & Africa remain under-penetrated but attractive. Telecom-linked micro-insurance pilots in Brazil and Nigeria demonstrate how mobile wallets can distribute low-ticket premium products, bringing first-time policyholders into the two wheeler/motorcycle insurance market. Regulatory modernization, including solvency reforms in the Gulf, is expected to unlock cross-border capacity and facilitate product transfers from mature markets.