April 17, 2024

Extended Warranty Market is Estimated to Witness High Growth Owing to Increasing Demand for Protection Against High Repair Costs

The extended warranty market provides coverage against breakdowns, defects and accidental damage for electronic devices, vehicles and home appliances beyond the standard manufacturer warranty period. It helps cover the rising repair and replacement costs by providing financial protection against unexpected repair bills. Extended warranties are increasingly being purchased for smartphones, laptops, game consoles and other electronics due to their higher repair and replacement costs. They also provide coverage for expensive household appliances and vehicles after the expiration of the original manufacturer warranty.

The Global Extended Warranty Market is estimated to be valued at US$ 140.2 Mn in 2024 and is expected to exhibit a CAGR of 6.6% over the forecast period 2024 to 2031.

Key Takeaways
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. The market provides opportunities for growth through partnerships with electronics retailers, vehicle dealers and appliance stores. Several players are focusing on global expansion by establishing operations in major markets including North America, Europe, Asia Pacific and Latin America.

Market drivers
The primary driver for the growth of the extended warranty market is the increasing repair and replacement costs of electronic devices, vehicles and appliances. As technology becomes more complex, repairing gadgets often costs a significant amount, sometimes more than half the original price. This makes extended warranty plans an attractive option. Additionally, the rising average lifespan of products is also driving the demand as people want to maximize product usage even after the original warranty expires.

PEST Analysis
Political: The extended warranty market is regulated by consumer protection laws. Regulations ensure transparency in policy coverage and claims settlement process.

Economic: Extended warranty help consumers protect their investments by covering repair costs during economic uncertainties. It provides financial protection from unexpected repair bills.

Social: Rising consumer awareness about benefits of post-purchase services and protection plans is driving the extended warranty market. Individuals want peace of mind regarding expensive purchases.

Technological: Advanced data analytics help providers improve risk assessment, enhance customer experience and streamline claims management. Customers can now buy policies and track claims status online conveniently.

Most of the Extended Warranty Market value is concentrated in North America and Europe. The United States accounts for the largest share due to significant vehicle ownership and availability of comprehensive extended coverage options for electronics and appliances.

The Asia Pacific region is projected to be the fastest growing market during the forecast period. Factors such as rising living standards, growing consumer electronics and automotive sectors are expected to support market expansion in emerging countries like China and India.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it