Aviation Insurance Market Size to Reach USD 6.50 Billion in 2031
The Aviation Insurance Market size was USD 3.97 Billion in 2023 and is expected to register a revenue CAGR of 6.3% during the forecast period
December 27, 2024 – The global Aviation Insurance market size reached USD 3.97 Billion in 2023 and is expected to register a revenue CAGR of 6.3% during the forecast period. Advancements in aircraft technology is a key factor driving market revenue growth.
Several electric vertical takeoff and landing (eVTOL) aircraft are preparing for commercial launch. Specialist insurers have traditionally been proponents of innovation, so there should be enough momentum in the short term to support the fledgling eVTOL business. The amount of available technology, as well as changing environmental requirements, will have a considerable impact on the commercial aviation industry in the coming decades, and each development will require the insurance sector’s cooperation.
Furthermore, following a wave of retirements and personnel transfer during the pandemic, the aircraft industry remains plagued by a lack of MRO facilities and considerable labor shortages, notably in specialized maintenance and engineering professions. The high degree of training necessary for aircraft maintenance professions, along with the competitive employment market, make it difficult to hire and keep skilled individuals. This condition causes maintenance delays and increases labor costs, which raises the overall cost of repairs. For an aircraft owner, this shortage impairs their capacity to execute timely and effective maintenance, increasing the likelihood of incidents and consequent claims.
However, the revenue growth of aviation insurance market is facing increase in cybersecurity issues. The European Aviation Security Agency (EASA) estimates that 1,000 airport cyberattacks occur each month on average. For several years, the rise of increasingly connected, digital airplanes has increased the likelihood of cyberattacks. Despite being statistically less common, cyberattacks on aviation connectivity items are regarded as the most essential and consequential threats, necessitating the need to reduce the danger of a cybersecurity compromise in this sector.
Key Highlights:
- Public liability insurance segment is expected to register the largest revenue growth rate over the forecast period. Third-party legal liability insurance is considered mandatory insurance. The insurance cover includes, first and foremost, legal liability when using the insured aircraft. It also involves the personal liability of all those involved in the operating of the aircraft. Similarly, the owner’s liability insurance protects against third-party claims for damages on the ground that arise because of legal provisions. Liability claims arising from bodily injury or damage to passengers’ property are not covered by the owner’s liability insurance.
- Commercial aviation insurance segment is expected to account for the largest revenue share over the forecast period. Commercial aviation provides important services to airports, aircraft owners and operators, and a variety of other aviation-related organizations. Commercial aviation insurance covers operations for hire, such as transporting passengers for charter or freight, flight schools and rentals, and any other operation that generates profit. This includes crop dusting, spraying, hunting, and firefighting. Aviation insurers provide a wide range of airport premises liability policies tailored to the specific needs of airport owners, operators, and lessees, whether they are individuals, partnerships, corporations, municipalities, or government entities.
- North America accounted for largest revenue share in the aviation insurance market in 2023 driven by increase in air travel, rising awareness and risk management. On June 2023, Air Centurion Insurance Services, an aviation insurance program administrator (PA), and SiriusPoint have formed a strategic relationship. SiriusPoint will provide capacity to Air Centurion beginning in August 2023, while also cooperating on its underwriting strategy and product offering development. Air Centurion will solely use SiriusPoint America Insurance Company’s paper throughout the United States.
- Some major companies in the market report includes Arthur J. Gallagher & Co., AXA SA, Allianz Commercial, Marsh LLC, Global Aerospace, Great American Insurance Group, Munich Re, Chubb, IAT Insurance Group, L&G Insurance, Wings Insurance, ScienceSoft USA Corporation, American International Group, Inc., and STARR International Company, Inc.
- On June 2024, Chubb has signed a definitive agreement to purchase Catalyst Aviation Insurance, a Melbourne-based managing general agent specializing in general aviation insurance for the Australian market. The addition of Catalyst Aviation would increase Chubb’s presence in an important aviation market, providing local market access for brokers and clients while also broadening the reach of Chubb Global Markets’ aviation insurance products and capabilities, which include its Lloyd’s platform.
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Navistrat Analytics has segmented aviation insurance market based on insurance type, policy type, application, end-use, and region:
- Insurance Type Outlook (Revenue, USD Billion; 2021-2031)
- Public Liability Insurance
- Combined Single Limit (CSL)
- Ground Risk Hull (Motion) Insurance
- Ground Risk Hull (Non-Motion) Insurance
- Hangar and Ground Support Equipment Insurance
- In-Flight Insurance
- Others
- Policy Type Module Outlook (Revenue, USD Billion; 2021-2031)
- Third-party liability insurance
- First-party insurance
- Application Outlook (Revenue, USD Billion; 2021-2031)
- Commercial Aviation Insurance
- General and Business Aviation Insurance
- End-Use Outlook (Revenue, USD Billion; 2021-2031)
- Aircraft and Aerospace Manufacturers
- Ground Operators
- Individual General Aviation Aircraft Operators
- Air Taxi Operators
- Others
- Regional Outlook (Revenue, USD Billion; 2021-2031)
- North America
- U.S.
- Canada
- Mexico
- Europe
- Germany
- France
- U.K.
- Italy
- Spain
- Benelux
- Nordic Countries
- Rest of Europe
- Asia Pacific
- China
- India
- Japan
- South Korea
- Oceania
- ASEAN Countries
- Rest of APAC
- Latin America
- Brazil
- Rest of LATAM
- Middle East & Africa
- GCC Countries
- South Africa
- Israel
- Turkey
- Rest of MEA
- North America