Market Size of Japan Car Insurance Industry
| Study Period | 2020-2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 20.31 Billion |
| Market Size (2029) | USD 26.18 Billion |
| CAGR (2024 - 2029) | 5.21 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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Japan Car Insurance Market Analysis
The Japan Car Insurance Market size in terms of direct written premiums value is expected to grow from USD 20.31 billion in 2024 to USD 26.18 billion by 2029, at a CAGR of 5.21% during the forecast period (2024-2029).
Under the law of Japan, all registered vehicles must be covered with compulsory automobile liability insurance to protect third parties from accidental injuries. These compulsory car insurances do not exist with coverage to the insured, property damage to third parties, and repair or replacement for the damaged vehicles, creating a market gap in car insurance products and providing an opportunity for insurance companies to launch their customized car insurance products. Post-COVID-19, net premiums written for compulsory automobile liability insurance in Japan observed a decline last year and increasing premiums of alternative car insurance products.
Unit sales volume of new passenger cars in Japan is observing an increase, with SUVs, Mini cars, and medium cars occupying a significant share of more than 60% in the overall sales, resulting in car insurance providers focusing on specific segments of cars on the other hand sales of used passenger cars are observing a decline and impacting their insurance business. Rising car safety norms and fewer car accidents in Japan are leading to declining insurance premiums on car insurance making it convenient for car owners to purchase from a varied segment of available car insurance products.
Rising technological and digital innovations are leading car insurance products in a new direction. Insurtech penetration in Japan Non-life insurance industry is observing a continuous rise, leading to an increasing number of car insurance providers coming up with online car insurance services to buy, renew, and claim car insurance. Telematics or usage-based insurance, which makes the insurance company calculate premium rates based on data generated from driving behavior, minimizes the asymmetric information and moral hazard issues between the buyers and insurers. Japan's telematics insurance market size has observed a continuous rise over the years and is expected to create rapid growth in Japan's car insurance market.
