Insurance Rating Platform Market Size, Share, Growth, and Industry Analysis, By Type (Cloud-Based and On-Premise), By Application (Automobile, Home, Motorcycle and Other), and Regional Forecast to 2028

Updated On: 22 April 2024

REPORT OVERVIEW

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The global insurance rating platform market size was 569.4 million in 2022. As per our research, the market is expected to reach USD 881.2 million by 2028, exhibiting a CAGR of 7.6% during the forecast period. The COVID-19 pandemic has been unprecedented and staggering, with these platform experiencing higher-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden rise in CAGR is attributable to the market’s growth and demand returning to pre-pandemic levels.

An insurance rating platform, also known as an insurance rating engine or insurance pricing engine, is a software solution used by insurance companies to calculate insurance premiums for policies. These platforms play a crucial role in the insurance industry by helping insurers determine the cost of coverage for various types of insurance, such as auto, home, health, or commercial policies.

These platforms use complex algorithms and mathematical models to assess risk factors associated with an insured person, property, or business. These factors can include demographics, location, claims history, vehicle details, and more. They integrate with various data sources, both internal (historical claims data, policyholder information) and external (credit scores, weather data, geographic information), to make more accurate premium calculations. Insurance companies define rating rules and underwriting guidelines specific to their business. The platform takes these rules into account when calculating premiums, ensuring consistency and compliance with company policies.

COVID-19 IMPACT: Increased Demand for Digitalization to Boost Demand Significantly

COVID-19 had a life changing impact globally. The insurance rating platform market was significantly affected. The virus had various impacts on different markets. Lockdowns were imposed in several nations. This erratic pandemic caused disruptions on all sorts of businesses. Restrictions tightened during the pandemic due to increasing number of cases. Numerous Industries were affected. However, the market for these platform experienced an increased demand.

With in-person interactions limited, there was a surge in online insurance sales. These platforms played a critical role in enabling insurers to offer quotes and sell policies through digital channels. With increased reliance on digital processes, the cybersecurity of these platforms became even more critical. Insurers had to invest in robust cybersecurity measures to protect sensitive customer data.

The pandemic accelerated the need for digitalization across all industries, including insurance. Insurance rating platforms became even more critical as insurers sought ways to provide online quotes and streamline policy issuance without physical contact with customers. The need for remote work during lockdowns highlighted the importance of cloud-based insurance rating platforms. Insurers needed systems that could be accessed securely from anywhere, ensuring business continuity. The pandemic accelerated investment in insurtech companies, including those developing advanced these platforms. These investments aimed to enhance automation, data analysis, and customer experience. The market is anticipated to boost the insurance rating platform market growth following the pandemic.

LATEST TRENDS

"Digital Transformation to Broaden Market Growth"

Insurance companies continue to invest in digital transformation efforts. This includes the adoption of advanced these platforms that facilitate online quotes, policy issuance, and claims processing. Insurers are striving to provide a seamless digital customer experience. The use of artificial intelligence (AI) and machine learning (ML) in insurance rating platforms has been on the rise. These technologies enable more accurate risk assessment and pricing by analyzing vast amounts of data. Insurers are leveraging AI and ML to enhance underwriting processes.

Insurance rating platforms are integrating with more real-time data sources, such as IoT devices, telematics, and weather data. This allows insurers to make more informed decisions and offer personalized policies based on up-to-the-minute information. Predictive analytics is becoming increasingly important for insurers. Rating platforms are incorporating predictive modeling to assess future risks and customer behavior, helping insurers proactively adjust their pricing and offerings. These latest developments are anticipated to boost the insurance rating platform market share.

SEGMENTATION

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• By Type

Based on type, the market is divided into cloud-based and on-premise.

• By Application

Based on application, the market is bifurcated into automobile, home, motorcycle and other.

DRIVING FACTORS

"Emerging Insurance Products to Boost Market Share"

Today's customers expect quick and convenient access to insurance products. Insurance rating platforms allow insurers to meet these expectations by providing instant quotes and policy issuance through online and mobile channels. Improved customer experience is a significant driver of the market. The introduction of new insurance products, such as usage-based insurance (UBI) for vehicles, cyber insurance, and parametric insurance, has created a demand for rating platforms capable of accommodating these innovative offerings. These platforms must adapt to the evolving landscape of insurance products and risk factors.

"Data Availability for Analysis to Boost Market Size"

The availability of a wide range of data sources, including telematics, IoT devices, social media, and historical claims data, has expanded the capabilities of these platforms. These platforms can now access and analyze diverse data sets to better assess risk and calculate premiums accurately. Advances in data analytics and artificial intelligence (AI) are driving the adoption of platforms. These platforms use AI and machine learning algorithms to analyze vast amounts of data, helping insurers make more accurate risk assessments and pricing decisions. Insurers are leveraging these technologies to gain a competitive edge and reduce underwriting and claims processing times. These factors are anticipated to drive the insurance rating platform market.

RESTRAINING FACTOR

"Legacy Systems and Regulatory Compliance to Hamper Market Share"

The insurance industry is heavily regulated, and insurers must comply with complex and evolving regulatory requirements. These platforms must adapt to changing regulations, which can be a significant challenge, especially for smaller insurers or those operating in multiple jurisdictions.

Many established insurance companies still rely on legacy systems for their core operations. Integrating modern these platforms with these legacy systems can be complex and costly. The factors are anticipated to hinder the growth of the insurance rating platform market.

REGIONAL INSIGHTS

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"North America Dominates the Market with Maturity of Insurance market"

North America, especially United States is a major hub for the insurance industry, with numerous insurance companies operating in the country. The U.S. market is highly competitive, and insurers have been quick to adopt technology to gain a competitive edge. This has driven the demand for insurance rating platforms.  It has one of the world’s largest and most mature insurance markets. It is home to a vast number of insurance companies, including some of the largest globally recognized firms. This extensive market size and reach create a significant demand for sophisticated technology solutions, including these platforms.

KEY INDUSTRY PLAYERS

"Key Players Focus on Partnerships to Gain a Competitive Advantage "

Prominent market players are making collaborative efforts by partnering with other companies to stay ahead in the competition. Many companies are also investing in new product launches to expand their product portfolio. Mergers and acquisitions are also among the key strategies used by players to expand their product portfolio.

List of Market Players Profiled

• Vertafore [U.S.]
• Applied Systems [U.S.]
• EZLynx [U.S.]
• ACS (Agency Computer Systems) [U.S.]
• ITC (Insurance Technologies Corporation) [U.S.]
• HawkSoft [U.S.]
• QQ Solutions [U.S.]
• Sapiens/Maximum Processing [Israel]
• Agency Matrix [U.S.]
• Buckhill [U.S.]
• InsuredHQ [New Zealand]
• Zhilian Software [China]

REPORT COVERAGE

This research profiles a report with extensive studies that take into description of the firms that exist in the market affecting the forecasting period. With detailed studies done, it also offers a comprehensive analysis by inspecting the factors like segmentation, opportunities, industrial developments, trends, growth, size, share and restraints. This analysis is subject to alteration if the key players and probable analysis of market dynamics changes.