The global UBI landscape: Adoption trends and what they mean for insurers

Usage-Based Insurance is growing fast, but not everywhere at the same speed.

Usage-Based Insurance (UBI) is still a minority of motor insurance portfolios globally. Yet its growth trajectory is hard to ignore: between 2020 and 2024, UBI expanded at a global CAGR of ~18%. That’s not a short-lived innovation cycle — it’s a signal that pricing, risk selection, and customer engagement are increasingly becoming data-driven.

What’s more interesting than the growth rate itself is where that growth is happening — and why some regions scale UBI much faster than others.

In this blog, I examine the global adoption of UBI, highlight the patterns observed by region, and frame the practical question insurers care about most: what conditions enable UBI to scale — and what do insurers need to do to succeed?

Global UBI momentum: from pilot to portfolio strategy

UBI has transitioned from being perceived merely as a beneficial innovation to a strategic instrument capable of exerting significant influence:

• Risk assessment (more granular segmentation than traditional rating variables)
• Profitability (improving loss ratio through selection, pricing adequacy, and risk prevention)
• Customer relationship (more frequent touch points than the annual renewal cycle)
• Differentiation (modern brand positioning, especially for younger segments and digital distribution)

Even in markets where telematics once felt experimental, the shift toward connectivity, mobile-first journeys, and AI-enabled analytics is making UBI increasingly viable at scale.

Regional adoption patterns: same concept, very different outcomes

North America: the fastest-growing region, already at meaningful penetration

In both policy volume and penetration, North America is the world’s fastest-growing UBI region, with the US and Canada showing strong adoption. Penetration has reached a level where UBI is no longer a niche: around 25% of insured personal vehicles are already covered under UBI-style programmes in this market.

This matters because it suggests North America has crossed a threshold where UBI is not just an add-on discount mechanism — it’s becoming a core pricing and engagement model in personal lines.

What it signals for insurers: once penetration reaches double digits, UBI can start reshaping competitive dynamics: pricing benchmarks, acquisition costs, and customer expectations.

Europe: slower development, strong pockets of maturity

Europe has generally developed more slowly over the same timeframe. While telematics insurance is well-established in a few markets — Italy, the UK, and, more recently, Germany — much of the region remains at an early stage, with limited programme scale and few success stories that have broken through to mass adoption.

Europe’s pace is not necessarily a lack of appetite — it is often a reflection of fragmentation: different regulatory expectations, market structures, and consumer attitudes toward data sharing.

What it signals to insurers: Europe tends to reward telematics insurance programmes that are privacy-forward, transparent, and tied to a clear value exchange (e.g., tangible savings or meaningful services).

Asia-Pacific: the “surprise” growth engine — and a huge runway

The region showing surprising growth is Asia-Pacific, with notable adoption in South Korea and Japan. At the same time, the region has significant room for expansion because of its total volumes.

That creates a very specific pattern: UBI policy counts can grow rapidly, while penetration in total auto insurance may not climb as quickly — simply because the denominator (total market volume) is so large.

This is also the region with the widest maturity range: some markets are scaling quickly, while others are still building foundational capabilities. And clearly, China stands out as a market with enormous long-term potential.

What it signals for insurers: in APAC, the winners are likely to be those who combine UBI with ecosystem partnerships (OEMs, mobile platforms, payments, mobility players) and scale through embedded distribution.

Other regions: early-stage, but an important trend for emerging markets.

In other regions, connected insurance is still mostly early-stage — but one trend is worth calling out:

UBI penetration is growing faster than the number of policies.

In markets where overall motor insurance adoption remains limited, connected insurance can grow faster than “regular” policies within an insurer’s portfolio. That means UBI is becoming a larger share of the insured base even if total policy counts remain modest.

What it signals for insurers: UBI can be a portfolio accelerator in low-penetration markets — not just a product innovation.

Why do some regions scale faster than others?

So why does one region move quickly while another stays in pilot mode?

The answer is not one factor — it’s a combination. But in our analysis, the most important drivers are:

A) The motor insurance baseline

• How mature is the market?
• Is price competition intense?
• Are consumers already shopping actively and comparing offers?
• Are insurers under pressure to improve loss ratios or fight commoditisation?

UBI scales faster where insurers need differentiation and where consumers already accept frequent switching.

B) Insurer readiness to innovate with connectivity, data, and AI

UBI is not only a product. It’s a capability:

• Data ingestion (smartphone, OBD, embedded, OEM)
• Data quality controls and explainability
• Scoring models that translate driving into risk
• Integration into pricing, underwriting, CRM, and claims
• Ongoing optimisation (model refresh, segment tuning, leakage control)

Regions that scale quickly tend to have insurers who treat UBI as a multi-year transformation programme, not a marketing campaign.

C) Consumer perception of UBI programmes

Consumer adoption hinges on trust and clarity:

• What data do you collect?
• How will it affect my premium?
• Is it fair?
• What happens if I opt out?
• Will my data be used beyond insurance?

Markets differ significantly in privacy expectations, willingness to share data, and appetite for behavioural programmes. UBI grows faster where the value exchange is explicit, and the programme feels transparent and beneficial.

What does this mean for insurers? Where does the real opportunity sit?

For insurers, UBI can be positioned in three strategic ways:

1) As a pricing and selection engine

• More refined segmentation
• Better pricing adequacy (especially for “good risks” who feel overcharged)
• Improved portfolio mix

2) As a retention and engagement platform

• Ongoing touch points (not just annual renewal)
• Coaching, gamification, alerts
• Stronger loyalty through earned savings

3) As a claims and prevention lever

• First notice of loss support (where permitted/feasible)
• Fraud signals (behavioural + contextual)
• Risk prevention messaging (weather, traffic, distraction)

The key is clarity: what’s the primary objective — profitability, growth, or loyalty? UBI can do all three, but the design choices differ depending on the goal.

UBI isn’t “whether” anymore, it’s “how fast”  and “how well”

UBI remains a small portion of global motor portfolios — but the direction is clear, and regional differences show that scaling is not automatic.

For insurers, the next step is to treat UBI as part of a broader strategy: a combination of product, analytics, operations, and customer experience — with a clear goal and an execution plan.

The question isn’t: should we launch UBI?
It’s: what’s our path from pilot to measurable portfolio impact?

Decide your 2026-2035 UBI strategy faster — markets, partners, and data model — using our analysis of 450+ live programmes across 33 regions,

Reach out if you want to learn more, [email protected]

Article written by Alberto Lodieu, under PTOLEMUS copyright