Product Warranty Insurance
The Product Warranty Insurance industry underwrites factory warranties for manufacturers and extended warranties for retailers and consumers. Product warranties insure major electronics, household appliances and other products against defects or damage and cover repair and replacement costs. A number of trends have put downward pressure on warranty premiums in recent years, hurting underwriting revenue for industry operators. Electronics are declining in price and are the largest product group for which industry operators underwrite warranties; this has translated to a decrease in the prices of premiums to insure these goods. Moreover, electronics and appliances are increasingly produced and sold abroad, and many of the largest manufacturers, such as Samsung and LG, are foreign-owned. Globalization in the industry's main markets has contributed to fewer warranties being underwritten domestically. Additionally, the industry's investment income has remained relatively flat over the period. Despite these negative trends, third-party providers that underwrite warranties directly for consumers are growing strongly due to their low-cost model, online convenience, highly rated customer service and rapid claims response teams. Innovative solutions from third-party providers will help return the industry to growth over the next five years.
This industry comprises establishments primarily engaged in underwriting product warranty policies, which protect the buyer of the product from defects and damage. The industry excludes warranty programs for homes, automobiles and other vehicles. It also excludes companies that perform repair services for products under warranty.
This report covers the scope, size, disposition and growth of the industry including the key sensitivities and success factors. Also included are five year industry forecasts, growth rates and an analysis of the industry key players and their market shares.
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