Professional Liability Insurance Market Size, Share, Growth, And Global Industry Analysis By Type (Medical Liability, Lawyer Liability, CPA Liability, Construction & Engineering Liability, and Other Liability), By Application (Up to $1 Million, $1 Million to $5 Million, $5 Million to $20 Million and Over $20 Million), Regional Insights, and Forecast To 2031

Updated On: 01 April 2024

PROFESSIONAL LIABILITY INSURANCE MARKET REPORT OVERVIEW

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The global professional liability insurance market size was USD 42530 million in 2021 and is projected to touch USD 60103.6 million by 2031, at a CAGR of 3.5% during the forecast period. 

Professional liability market insurance gives protection to businesses and professionals against claims or financial losses initiated by clients. The benefits and advantages depending on the profession of the individual. However, it does not cover any expenses of criminal prosecution.

There has been an increased risk of misconception and negligence faced by the professionals and they are often the victims in the rising era of social media. Moreover, the demand for quality services and rise in business ventures trigger malpractices or professional liability. In that case, more professionals and businesses are acquiring professional liability insurance to reduce the pocket cost in face of uncertainties and financial loss.

COVID-19 Impact:  Slowdown of Economy Interpreted the Market Growth

The global COVID-19 pandemic has been unprecedented and staggering, with the professional liability insurance market experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. The rise in CAGR is attributable to the professional liability insurance market growth and demand returning to pre-pandemic levels once the pandemic is over.

COVID-19 has posed many challenges to the professional liability insurance market growth. The sudden onset of the pandemic and transformation in the economy and work culture affected the market share. Insurance rates are increasing, contracting coverage limits and loss of clients. Moreover, there was a spike in cyber cases, unlawful termination and unavailability of human resources. The market is anticipated to bounce back as the situation returns to normal and the economy becomes stable.

LATEST TRENDS

"Adaptation of InsurTech to Enrich the Customer Experience"

Service-based businesses are on the lookout to integrate innovative technologies to provide the best customer experience. Insurance companies are gradually in the process of revamping their operation structure. Big data and blockchain are adopted by the big insurance companies to solve the problem of data and opacity.  Insurance companies rely on data to run their businesses. They have lagged in recent years and are now endorsing the innovation in their favour. The introduction of Artificial Intelligence and Robotics for improved customer experience and lower commission is being embraced by many insurance companies. The insurance sector is moving towards digitalization. There is always a risk associated with shifting from traditional operation in a vast socio-economy society however, companies are ready to address these issues and find a solution to boost the professional liability insurance market size.   

PROFESSIONAL LIABILITY INSURANCE MARKET SEGMENTATION

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• By Type

Based on type, the market is divided into medical liability, lawyer liability, CPA liability, construction & engineering liability, and other liability. Medical liability segment will dominate the market share during 2022-2028.

• By Application

Based on the application, the market is divided into up to $1 Million, $1 Million to $5 Million, $5 Million to $20 Million and over $20 Million. The $1 million segment will dominate the market share through 2028.

DRIVING FACTORS

"Urbanization and Transformation towards Service-sector Economy to Expedite Market Growth "

The economy is ever-changing with the growing needs of consumers. The last decade witnessed an increase in service-based business which has the potential to generate a higher revenue than the manufacturing sector. The service sectors provide service as the solution to the existing problems. The easy availability of information or data due to the advancement of the internet has triggered service-based businesses. Moreover, the incorporation of high technology improved the structure and quality of the service making it more accessible, cost-effective, efficient and less time-consuming. The developing countries are investing in larger firms because of their international standards and adherence to quality and their ability to provide training to skilled people which influence the economy of the country in the long run. Digital media and technology provide new markets. Professionals and technical services have seen continuous growth and demand across the globe. In light of these developments, it becomes a necessity to subscribe to professional liability insurance to protect the business from future malpractices or claims initiated by the client. Businesses might get into a tough spot and accidents might occur due to various unavoidable circumstances. The insurance covers all the necessary expenses and compensates for the loss. It acts as risk management and saves from unexpected losses. Urbanization and the rise in businesses are major driving factors for the professional liability insurance market share. 

"Increase in Awareness of the ""Professional Liability Insurance Plan to Boost the Market Demand"

The professionals are not limited to the technology sector. There is an increasing number of doctors, architects, lawyers and other professionals with specializations.  The usage of the internet has made education free and accessible to all. Consumers can research the advantages of the insurance plan on their own. Moreover, the government policies in the last decade and extensive media convergence have captured the attention of businesses and professionals. Stakeholders and organizations are encouraging financial education programmers. Government and bank initiatives played a major role in spreading awareness. In addition to that, the population expansion, consumer demands, and increase in the number of businesses have compelled them to opt for professional liability insurance to minimize the risk.

RESTRAINING FACTORS

"High Insurance Amount and Longer Time for Claim Settlement to Act as a Restraining Factor"

The pandemic times have pointed out the importance of health insurance during times of uncertainty. However, in this time of inflation and costly healthcare, it is becoming expensive beyond the reach of common people with average income. The insurance companies should make it more affordable to middle-class people. Apart from this, there have been cases where claims took a long time to settle or instances when claim money was not approved. These incidents sum up in the minds of the people and they avoid insurance and consider it a poor choice. Lack of awareness, past incidents and myths will act as a restraining factor for the professional liability insurance market.

PROFESSIONAL LIABILITY INSURANCE MARKET REGIONAL INSIGHTS

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"Asia Pacific Region to Dominate the Market due to the Developing Economies. "

Asia Pacific countries are developing at a tremendous rate which implies better infrastructure and the presence of international firms. Better education is resulting in the rise of professionals in these countries and increasing in the subscription of professional liability insurance plans. China is dominating this region owing to its vast population, innovations, good economy and rise in the service-based business sector.

KEY INDUSTRY PLAYER

"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 of 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 portfolios.

List of Market Players Profiled

• Chubb (ACE) (Switzerland)
• AIG (China)
• Hiscox (UK)
• Allianz (Germany)
• Tokio Marine Holdings (Japan)
• XL Group (U.S)
• AXA (France)
• Travelers(U.S)
• Assicurazioni Generali (Italy)
• Doctors Company (U.S)
• Marsh & McLennan (U.S)
• Liberty Mutual (U.S)
• Medical Protective (U.S)
• Aviva (India)
• Zurich (Switzerland)
• Sompo Japan Nipponkoa (Japan)
• Munich Re (Germany)
• Aon (India)
• Beazley (U.K)
• Mapfre (Spain)

REPORT COVERAGE

This report covers the analysis of the professional liability insurance market providing a comprehensive market insight taking into consideration the existing key players who would play a crucial role in the forecasting period. It also analyses based on segmentation, industrial developments, trends, growth, size, share, restraints and revenue. The report covers an overview of the latest driving factor in the industry, dominant region, latest innovations and opportunities.