Singapore Motor Insurance Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

Singapore Motor Insurance Market Trends and Insights

Mandatory Third-Party Motor Insurance Compliance Under Singapore Law

In Singapore, the Motor Vehicles (Third-Party Risks and Compensation) Act mandates motor insurance, significantly shaping the nation's motor insurance landscape. Legally, every motor vehicle must possess third-party liability coverage. Those who flout this rule face fines or imprisonment, leading to almost universal policy adoption and a consistent premium volume. The Motor Insurers’ Bureau bolsters market integrity by compensating victims in incidents with uninsured drivers. Regulatory moves, like mandating accident reports to insurers, aim to curb fraud and speed up claims. The General Insurance Association notes that stringent enforcement has kept motor insurance penetration near 100%^{[1]General Insurance Association of Singapore, “Motor Insurance Consumer Guide,” gia.org.sg}. This high penetration grants insurers a predictable market, enabling them to pivot from merely acquiring customers to innovating in product development and refining risk analytics.

EV Adoption Driving Specialized Policies and Coverage Extensions

In Singapore, the surge in electric vehicle (EV) adoption is spurring the evolution of specialized motor insurance policies. While EVs constituted a mere 3.3% of the national car parc in 2024, they dominated new vehicle registrations at 32.5%. This spike is largely attributed to government incentives reaching up to SGD 40,000^{[2]Liberty Insurance, “Coverage and Premiums in Singapore EV Insurance,” libertyinsurance.com.sg}. Insurers are now crafting products that cater to unique EV risks, including battery degradation, potential damage to charging equipment, and cyber threats. Reflecting the elevated repair costs and the scarcity of spare parts, these tailored policies come with a 15–20% premium over traditional motor insurance. A standout in this arena is Income Insurance’s eDrivo plan, boasting features like 24/7 mobile charging support and optional battery replacement coverage^{[3]Income Insurance, “eDrivo Car Insurance,” income.com.sg}. With EV prices on a downward trend and the public charging infrastructure broadening, the premium pool for EV insurance is poised for double-digit growth, underscoring its significance as a strategic growth avenue for insurers.

Telematics & Usage-Based Insurance Backed by MAS Sandboxes

In Singapore, the motor insurance market is increasingly being shaped by telematics and usage-based insurance (UBI), with backing from the Monetary Authority of Singapore’s (MAS) regulatory sandbox framework. This initiative permits insurers to experiment with innovative models, such as pay-per-kilometre and behaviour-based pricing, while benefiting from reduced capital requirements. A notable instance is Carro’s “Covered” plan, underwritten by NTUC Income. This plan utilizes onboard diagnostics and AI-driven scoring to dynamically adjust premiums based on driving behaviour. As a result, safe drivers are reaping discounts of up to 30%. This shift indicates a move in underwriting practices, prioritizing behaviour-based metrics over traditional demographic factors. Industry experts project that by 2030, usage-based insurance could represent 15% of all motor policies, enhancing insurers' loss ratios and deepening customer engagement.

Ride-Hailing and Last-Mile Delivery Fleet Expansion Raising Policy Demand

In Singapore, the rise of ride-hailing services and last-mile delivery fleets is fueling a surge in demand for motor insurance policies tailored to commercial needs. Companies like Grab and foodpanda are turning to hybrid insurance solutions that cater to both personal and commercial usage. Consequently, commercial motor premiums are witnessing a robust CAGR of 9.20%. Fleet operators are now on the lookout for features such as adjustable deductibles, roadside assistance, and tools to monitor driver performance. Insurers are harnessing the power of telematics, tracking metrics like vehicle mileage, passenger loads, and route data. This not only paves the way for usage-based pricing but also helps in curbing fraud. With Singapore's dense urban landscape, these fleets are integral to the nation's transportation framework, driving consistent growth in the motor insurance market.

Price Wars and Discounting on Aggregators Compress Underwriting Margins

Digital insurers are rapidly capturing market share with ultra-low prices, sparking a race-to-the-bottom that tightens margins across the board. In response, some carriers are turning to strategies like offering higher excesses or unbundled add-ons. However, these approaches come with the risk of creating coverage gaps, potentially eroding customer trust. Ongoing discounting pressures the solvency buffers of smaller players, underscoring the critical need for robust capital strength in line with risk-based regulations. The low prices and margins hinders the growth of Singapore motor insurance market.

Vehicle Population Plateau Limits New Policy Volume

In Singapore, the motor insurance market grapples with a structural constraint on new policy volumes, primarily due to the Certificate of Entitlement (COE) system. This system curbs the growth of the vehicle population to nearly zero, a measure aimed at controlling road congestion. Consequently, insurers pivot their strategies towards customer retention, upselling enhanced coverage, and implementing premium increases to bolster revenue, sidelining the expansion of policy numbers. While shifts in COE prices can sway consumer decisions, prompting those with heftier premiums to lean towards more comprehensive coverage, the enduring cap on vehicle numbers remains a significant hurdle for top-line growth.

Segment Analysis

By Policy Type: Usage-Based Models Disrupt Traditional Coverage

Comprehensive cover dominated with a 72.3% share in 2024 because high car values and dense traffic elevate perceived loss severity. The Singapore motor insurance market size tied to comprehensive policies is projected to edge up at 1.84% CAGR, underpinned by COE-driven vehicle valuations. Third-party fire-and-theft plus third-party only policies serve older or budget vehicles but face cannibalization when drivers shift to flexible usage-based plans.

Adoption of telematics is reshaping premium mechanics. Usage-based contracts grow 12.4% annually as drivers embrace mileage-linked savings, and MAS sandboxes shorten launch cycles. The Singapore motor insurance market share of usage-based policies would materially dilute fixed-premium dominance, forcing incumbents to refine risk-scoring algorithms and telematics partnerships. 

Note: Segment shares of all individual segments available upon report purchase

By Vehicle Type: EV Transition Reshapes Risk Profiles

Private cars contributed 81.2% of written premiums in 2024, yielding a stable but low-growth segment because registration caps persist. The Singapore motor insurance market size for private cars is forecast to inch forward at only 1.65% CAGR through 2030. Conversely, motorcycles and scooters record 13.43% CAGR, supported by affordability and delivery-fleet demand, albeit from a lower base.

Electric vehicles inject complexity into underwriting because batteries, power electronics, and aluminium bodywork push repair bills higher. EV policies carry premiums 15-20% costlier than combustion models; however, incentives and charging-network rollout fuel rapid parc growth. By 2030, EVs may comprise a tenth of registered cars, magnifying their impact on loss ratios and giving data-rich insurers an underwriting edge. 

By Distribution Channel: Digital Platforms Challenge Traditional Intermediaries

Agents and brokers retained 46.3% of policies in 2024, yet their share is slowly eroding as mobile-first purchasing gains traction. The Singapore motor insurance market size distributed via agents is expected to remain flat, while aggregator-led sales accelerate 15.51% CAGR, widening the direct channel’s revenue base. 

Aggregators improve transparency but commoditise offerings. To stay relevant, intermediaries integrate digital advisory, bundle multi-line covers, and highlight claims service track records. Insurers blend omnichannel models: online for acquisition, brokers for high-value renewals and complex fleets, and banking partners for cross-selling moments. 

Note: Segment shares of all individual segments available upon report purchase

By End-User: Commercial Segment Outpaces Personal Lines Growth

Personal lines commanded 78.2% of premiums in 2024, yet they grow slowly because individual vehicle numbers are capped. Commercial fleet premiums climb 9.24% annually as ride-hailing, logistics, and car-sharing operators scale. Loss-cost volatility is higher in commercial portfolios, pushing insurers to embed telematics, driver training, and dynamic deductibles. 

As corporate sustainability targets rise, companies adopt electric vans and two-wheelers, which alter claims patterns and downtime costs. Insurers that master EV parts sourcing and rapid repair networks are likely to win share in the expanding commercial niche. 

Geography Analysis

Singapore’s compact geography nullifies regional rating but sharpens focus on driver behavior, vehicle tech, and urban-density factors. Extensive CCTV coverage and smart-traffic systems supply high-quality claims evidence, aiding fraud detection and dispute resolution. Tropical rainfall triggers flash-flood events that insurers price into comprehensive covers, especially for low-lying car parks.

The government's ambition to become a “car-lite” nation shapes long-term demand. Investments in rail and bus capacity aim to cut private-vehicle reliance, yet gig-economy fleets and short-term rentals rise in parallel, diversifying premium sources. MAS supervision mandates strong solvency, prompting ongoing capital optimization, while digital-identity infrastructure underpins frictionless e-KYC, supporting cost-efficient scaling of direct channels. 

EV adoption is geographically concentrated around public housing estates with communal chargers and affluent districts with landed property charging points. As the charger map densifies, insurers expect EV claim frequencies to converge with combustion norms, though severity may stay elevated due to battery pricing. Singapore’s strict import rules and scheduled de-registration at 10-year intervals ensure vehicle age remains young, keeping average repair costs high.