The U.S. On-Demand Insurance Market is Projected to Grow from $2.16 Billion in 2025 to $7.05 Billion by 2035, While Europe is Expected to Expand from $1.92 Billion to $6.72 Billion by 2035.
Austin, United States, Sept. 07, 2026 (GLOBE NEWSWIRE) — The On-Demand Insurance Market was valued at USD 6.85 Billion in 2025 and is expected to reach USD 24.60 Billion by 2035, growing at a CAGR of 13.60% from 2026 to 2035.
Market expansion is driven by an increase in consumer and commercial needs for flexible and activation-based insurance covering their needs only when it is required. Insurance based on mobile platform allows the consumers to activate or deactivate their insurance for each particular trip, vehicle usage, asset, or period of events. Increased involvement in gig economy, increased penetration of smartphones, and increased use of telemetry pricing are driving this trend. On January 23, 2026, Lemonade introduced Autonomous Car insurance policy for owners of Tesla’s Full Self-Driving cars at 50% per mile cheaper rate than regular car insurance.
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Key Takeaways:
- Leading Insurance Type: Auto Insurance (~34.60% share)
- Leading Distribution Channel: Insurtech Mobile Platforms (~46.80% share)
- Leading Coverage Model: Pay-As-You-Go (~48.30% share)
- Leading End User: Individual Consumers (~63.90% share)
- Largest Regional Market: North America
- Fastest-Growing Regional Market: Asia Pacific
Market Segmentation
By Insurance Type
Auto Insurance has maintained its leading position in the market by generating about 34.60% of revenue shares in 2025, owing to the increasing use of telematics and pay-as-you-drive (PAYD) insurances by ride-sharing drivers, temporary rental car customers, and even private vehicle owners. Travel Insurance is the rapidly expanding segment with a CAGR of about 18.90% during 2026-2035 owing to the increasing tourism and inclusion of single trip insurance in airline bookings and online bookings.
By Distribution Channel
Insurtech Mobile Platforms dominated the largest market share with 46.80% in 2025 due to the ease of use for activating policies, speedy quotes, and quick claims. Embedded Insurance would grow the fastest with the CAGR of 19.60% because insurance will become more embedded directly into transactions in e-commerce, mobility, fintech, and others.
By Coverage Model
The Pay-As-You-Go segment accounted for about 48.30% of the market share in 2025, owing to its simple time-based activation process which helps the customers to get insured for particular periods of time. The Event/Trigger-Based segment holds the fastest growth rate of approximately 18.70% in the forecast period, owing to the ability of real-time data to trigger policies and claims through events such as delayed flights and bad weather.
By End Users
Individual Consumers was the leading segment with about 63.90% market share in 2025, owing to growing awareness of flexible insurance policies and reduced cost for micro-duration insurance plans. Gig Economy Workers will witness the highest growth rate at a CAGR of approximately 19.30% during 2026-2035, owing to growing need of insurance cover only when working.
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Regional Analysis
North America held the highest share of around 37.10% of revenue in the on-demand insurance market in 2025 owing to a robust insurtech ecosystem, high consumer trust towards mobile finance applications, high penetration of smartphones, and a large number of gig-economies. The United States held around 85.20% of the revenue in the North America region owing to the availability of leading digital insurers along with high penetration of usage based automobile insurance, renter insurance and specialty insurance.
Valuation of the United States on-demand insurance market in 2025 stands at USD 2.16 billion and is estimated to reach USD 7.05 billion by 2035, recording a CAGR of 12.60% between 2026 and 2035. The factors driving the growth are mature insurtech ecosystem, use of smartphones and digital payments, a sizable gig economy, and growing investments in telematics and AI-based underwriting.
Europe on-demand insurance market size is estimated to be around USD 1.92 Billion in 2025 and will reach USD 6.72 Billion by 2035, registering a CAGR of around 13.20% in the period of 2026–2035. Europe held approximately 28.00% share in the global market in 2025. The UK held approximately 28.30% share in terms of revenue of the Europe market, backed by presence of insurtech companies and telematics motor insurance companies, while Germany, France, and the Netherlands are contributing through embedded insurance partnerships and mobile insurance products.
Asia-Pacific is estimated to show the highest growth rate during the forecast period backed by the rapidly increasing usage of smartphones and digital payment systems, huge gig economy labor pools, and innovations by insurtech players of the region. China held approximately 38.60% share in terms of revenue of the Asia-Pacific market, backed by the large online insurance ecosystem in China and consumer awareness about embedded insurance products, while India and South East Asia are benefiting from expanding ride-hailing apps and e-commerce platforms.
Rising gig-economy participation and embedded distribution support market growth
The increase in gigs and shared-mobility work, along with changing preferences among consumers who are seeking flexible pay-as-you-go finance options, is driving the demand for on-demand insurance. The customer has the option of covering themselves based on the duration of time, trip, property, or activity that requires coverage, thus linking premium costs directly to the risk involved. Embedding insurance in e-commerce, travel, and mobility applications is also lowering barriers to purchase, while improvements in telematics and Internet-of-Things devices will help pricing become more accurate.
Key Players:
- Lemonade, Inc.
- Root Insurance Company
- Hippo Insurance Services, Inc.
- Slice Insurance Technologies, Inc.
- Zego Ltd.
- Cuvva Ltd.
- Cover Genius Pty Ltd.
- Sure, Inc.
- ManyPets, Inc.
- Allianz SE
- AXA SA
- Zurich Insurance Group Ltd.
- Chubb Limited
- Ping An Insurance (Group) Company of China, Ltd.
- ZhongAn Online P&C Insurance Co., Ltd.
- Tokio Marine Holdings, Inc.
- Assurant, Inc.
- The Progressive Corporation
- The Allstate Corporation
- State Farm Mutual Automobile Insurance Company
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Recent Developments
2026: Lemonade launched Autonomous Car insurance, a usage-based product for Tesla Full Self-Driving customers that reduces per-mile rates by approximately 50% when FSD is engaged.
2026: Cover Genius partnered with Tongcheng Travel to expand embedded travel insurance for international customers in Malaysia and the Philippines through its XCover distribution platform.
2025: Zego launched a new social, domestic and pleasure car insurance product for new drivers and introduced a Rest feature within its Sense app using proprietary telematics to detect driver fatigue and support personalized premiums.
Exclusive Sections of the Report (USPs)
- On-Demand Insurance & Usage-Based Coverage Metrics – helps you understand adoption trends across activation-based, mileage-based, and short-duration insurance products globally.
- Insurtech Mobile & Embedded Distribution Metrics – helps you evaluate mobile insurance platform adoption and embedded coverage expansion across e-commerce, travel, mobility, and fintech channels.
- Telematics & Dynamic Pricing Metrics – helps you analyze the use of connected-device data, driver behavior information, and real-time pricing across usage-based insurance models.
- Gig Economy & Flexible Coverage Metrics – helps you assess demand for temporary and work-linked insurance among ride-hailing, delivery, freelance, and shared-mobility workers.
- Parametric & Event-Based Insurance Metrics – helps you identify growth opportunities in automatically triggered coverage for travel disruptions, weather events, and other measurable risks.
- Competitive Landscape & Digital Insurance Expansion Metrics – helps you gauge the competitive strength of established insurers and digital-first insurtech providers based on product innovation, distribution reach, and digital coverage capabilities.
Read Other Related Reports:
Insurtech Market Size Report by 2035
Commercial Insurance Market Size Report by 2035
IoT Insurance Market Size Report by 2035
Cyber Insurance Market Size Report by 2032
Insurance Analytics Market Size Report by 2035
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