Automotive Extended Warranty Segment is the largest segment driving the growth of Extended Warranty Market
The global Extended Warranty Market is estimated to be valued at US$ 123.4 Mn in 2023 and is expected to exhibit a CAGR of 6.6% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
The Extended Warranty Market covers warranty services provided by third parties for consumer goods such as automobiles, mobile devices, appliances, and others beyond the manufacturer warranty period. It provides consumers with peace of mind against unexpected repair costs.
Market key trends:
One of the key trends driving the growth of the Extended Warranty Market is the increasing average lifespan of consumer goods. With technological advancements, products are built to last longer while their warranty periods remain the same, leaving consumers vulnerable after the original warranty expires. This has boosted demand for extended warranty plans that provide coverage throughout the usable life of a product. However, the increasing preference of consumers towards pay-per-use models has led manufacturers to focus on developing innovative after-sales service platforms, which could hamper the demand for traditional extended warranty programs in the coming years.
SWOT Analysis
Strength: Extended warranty provides extra coverage for consumers beyond the standard manufacturer's warranty. It offers financial protection against unforeseen repair costs.
Weakness: Some customers view extended warranties as unnecessary expenses since many products have high reliability. The additional coverage may not justify the extra costs in some cases.
Opportunity: Growth in sales of consumer electronics and automobiles presents an opportunity to sell more extended warranty contracts. Rising living standards are increasing discretionary spending on such products.
Threats: Improving quality of products lowers the need for extended warranty programs over time. Self-insurance by consumers is a threat as some opt not to purchase coverage.
Key Takeaways
The Global Extended Warranty Market Demand is expected to witness high growth, exhibiting CAGR of 6.6% over the forecast period, due to increasing consumer electronics sales. Higher prices of devices are making customers more inclined towards extended warranties for financial protection.
Regional analysis: North America dominated the extended warranty market in 2023, accounting for around 35% share. Increasing automotive sales and widespread adoption of consumer electronics have contributed to the region's large size. Asia Pacific is projected to witness the fastest growth during the forecast period due to rising disposable incomes and electronic goods penetration in developing nations.
Key players operating in the extended warranty market are ASSURANT INC., American International Group, Inc., AXA, AmTrust Financial, Asurion, CARCHEX, CarShield LLC, Endurance Warranty Services LLC, Edel Assurance, SquareTrade, Inc., and Others. Players are focusing on partnerships with retailers and manufacturers to increase sales through bundling with product purchases. They are also adopting digital platforms to provide easy claims procedures.
Read More:
https://insightskies12.blogspot.com/2023/12/increasing-preference-for-protecting.html
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