Report: Rising incomes, Internet will driving boating insurance
The independent industry and market research group IBISWorld has released it's latest report and analysis on the boating insurance industry, predicting that growth for the industry over the next 5 years will be driven by fatter wallets and technological improvements in online shopping and comparison.
The boat insurance industry's top four companies - State Farm, Liberty Mutual, Progressive and Allstate - accounted for 27.8 percent of industry revenue in 2012, according to IBISWorld. Despite revenues in the boat insurance industry sliding 0.9 percent between 2007 and 2012, the top companies have managed to increase market share slightly through a wide range of product offerings and name brand recognition.
Due to new boat sales dropping more than 15.0 percent annually between 2008 and 2010, lower disposable income and an annual increase of 8 percent in oil prices over the five years through the end of 2012, total revenue for the industry is expected to drop by 0.9 percent annually over this period. However, IBISWorld says that disposable income is expected to increase by 1.3 percent in 2012, which will help encourage consumers back out to the water.
Despite a shrinking market, the number of boat insurance companies in the marketplace has increased 0.4 percent over the past five years to 1,356 businesses in 2012 employing 45,000 people.
This growing business base, combined with frugal consumers weary of the Great Recession and a series of natural disasters along the East Coast have come together to hurt industry profit over the past five years, IBISWorld said in a release. Damage from hurricanes and superstorms in 2008 (Ike), 2011 (Irene) and 2012 (Sandy) coupled with increased marketing spending to counteract the contracting market contributed to the shrinking profit of 0.4 percent annually for the boat insurance market.
The most common insurance claims, excluding storm related damage, according to National Boat Owners Association were: Hitting a submerged object while cruising, theft while anchored and collision with other boats.
The full report is available for purchase here: Boat Insurance in the US: Market Research Report