by The extended warranty market is estimated to be valued at US$ 123.4 Million In 2023 and is expected to exhibit a CAGR of 6.6% over the forecast period 2022-2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
The extended warranty market refers to the service offered by manufacturers or third-party providers to extend the warranty period beyond the standard warranty provided by the manufacturer. This helps consumers protect their investments and provides peace of mind by covering repair or replacement costs for unforeseen mechanical or electrical failures. The market includes warranty coverage for various products such as electronic devices, appliances, vehicles, and other consumer goods. With the increasing adoption of new-age electronic devices and growing awareness about the importance of vehicle protection plans, the demand for extended warranties is expected to witness significant growth over the forecast period.
Market Dynamics:
The growth of the extended warranty market can be attributed to two main drivers. Firstly, the rising adoption of new-age electronic devices such as smartphones, laptops, and smart home appliances has increased the need for extended warranty services. These devices are expensive and prone to malfunctions, making extended warranty coverage an attractive option for consumers. Secondly, the increasing awareness about the importance of vehicle protection plans among consumers is driving the demand for extended warranties in the automotive sector. With the growing complexity and cost of vehicle repairs, consumers are opting for extended warranty coverage to safeguard their investment and avoid unexpected expenses. These drivers are expected to fuel the growth of the extended warranty market over the forecast period.
Segment Analysis:
The Extended Warranty Market can be segmented based on product type, distribution channel, end-use industry, and region. By product type, the market can be divided into automotive extended warranties, electronic extended warranties, appliance extended warranties, and others. Among these, automotive extended warranties dominate the market due to the increasing demand for vehicle protection plans and a rise in automotive sales.
PEST Analysis:
Political: The political environment plays a crucial role in the extended warranty market. Government regulations regarding warranty policies and consumer protection laws impact the market dynamics.
Economic: The economic factors such as disposable income, consumer spending, and GDP growth rate influence the demand for extended warranties. Economic stability and rising consumer confidence contribute to market growth.
Social: Growing awareness about the benefits of extended warranties, rising consumer preferences for product protection, and the increasing ownership of high-value electronics and automobiles drive market growth.
Technological: Technological advancements such as connected cars, smart appliances, and digital platforms for warranty management have positively impacted the extended warranty market. Integration of AI and IoT in warranty services offers new growth opportunities.
Key Takeaways:
The global extended warranty market is expected to witness high growth, exhibiting a CAGR of 6.6% over the forecast period (2022-2030). This growth can be attributed to increasing consumer demand for extended warranties to safeguard their purchases against unexpected breakdowns or repairs. The automotive extended warranty segment is projected to dominate the market due to the surge in vehicle sales and the need for comprehensive coverage.
In terms of regional analysis, North America is the fastest-growing and dominating region in the extended warranty market. The region’s strong presence of key players, high disposable income, and a technologically advanced environment contribute to its market dominance.
Key players operating in the extended warranty market include ASSURANT INC., American International Group, Inc., AXA, AmTrust Financial, Asurion, CARCHEX, CarShield LLC, Endurance Warranty Services LLC, Edel Assurance, SquareTrade, Inc., and others. These players offer a range of extended warranty plans and leverage advanced technologies to enhance customer experience and streamline claim processes.
*Note:
- Source: Coherent Market Insights, Public sources, Desk research
- We have leveraged AI tools to mine information and compile it
Money Singh is a seasoned content writer with over four years of experience in the market research sector. Her expertise spans various industries, including food and beverages, biotechnology, chemical and materials, defense and aerospace, consumer goods, etc.
