Short Term Insurance Market Size & Forecast [2025-2034]

SHORT TERM INSURANCE MARKET OVERVIEW

The global short term insurance market size was valued at approximately USD 41.26 billion in 2025 and is expected to reach USD 66.46 billion by 2034, growing at a compound annual growth rate (CAGR) of 5.44% from 2025 to 2034.

Short Term Insurance is a form of coverage that offers protection for a set period, usually spanning from a couple of months to a year. It's tailored for individuals or businesses needing temporary protection for specific events or times, like travel, health coverage for a short while, or vehicle insurance for a limited duration. Compared to traditional long-term policies, Short Term Insurance is often more adaptable and affordable. This makes it attractive to those seeking short-term solutions without being tied down by yearly contracts. Its popularity has soared due to its flexibility and the growing demand for on-demand insurance products.

IMPACT OF KEY GLOBAL EVENTS

“Rise of Gig Economy and Freelance Work”

The gig economy and freelance work are boosting the need for short-term insurance worldwide. Non-traditional workers often need flexible coverage for healthcare, income, and liability that long-term policies lack. Short-term insurance helps freelancers and gig workers who miss out on employer benefits. This trend toward temporary insurance is changing the insurance world. Freelancers rely on short-term policies during busy times, projects, or short contracts. Platforms like Uber, Airbnb, and freelance sites drive demand for these products, giving insurers a chance to create tailored policies. As this market grows, insurers must develop personalized solutions to handle new risks.

LATEST TREND

”Rise of Digital Platforms in Short Term Insurance”

In the Short Term Insurance market, digital platforms are increasingly used for policy purchases and management. Consumers seek convenience, leading insurers to offer fully digital solutions. These solutions enable quick policy acquisition, claims processing, and support. The demand for tailored, on-demand insurance drives this shift. AI and big data help personalize policies. As mobile apps and online portals become preferred, insurance becomes more accessible and user-friendly. This trend is expected to continue, valued for its speed and convenience.

SHORT TERM INSURANCE MARKET SEGMENTATION

By Type

Based on Type, the global market can be categorized into Travel, Health, Car, Event, and Others.

Travel Insurance: Travel insurance safeguards individuals while they are on trips, covering medical emergencies, cancellations, and interruptions. This area has grown significantly, fueled by more global travel and the desire for protection against unexpected events. With more consumers realizing the value of temporary coverage while traveling, the market is poised for further expansion. Many now see the wisdom in insuring against potential problems on the road. This understanding drives the continued rise of travel insurance.

Health Insurance: Short-term health insurance provides temporary medical coverage, often for those between jobs or without long-term plans. This market is expanding as more people seek flexible health options. It attracts individuals in need of cost-effective, short-term solutions during gaps or transitions in their primary insurance. Many now find this option appealing for its temporary and budget-friendly protection.

Car Insurance: Short-term car insurance offers temporary coverage for vehicle use, typically for rentals or short-term ownership. It suits drivers who don't need long-term policies but want protection for a specific time. This market is growing, fueled by the sharing economy and car rentals. These trends have increased the demand for flexible, short-duration insurance plans. Many now find short-term car insurance a handy option for their temporary needs.

Event Insurance: Event insurance safeguards against unexpected happenings at events like weddings, conferences, and concerts. This coverage is vital for reducing financial risks from cancellations, damage, or liabilities. The event insurance market is expanding as organizers and individuals see the importance of temporary protection for special events. More people now understand the value of insuring their special occasions against potential problems.

Others: This category includes various other short-term insurance products, such as pet insurance and vacation home insurance. As consumer tastes change, the "Others" segment is growing more diverse, providing options for many temporary needs. It now offers solutions for a wide array of short-term protection requirements.

By Application

Based on Application, the global market can be categorized into Healthcare, Travel & Leisure, Automotive, Event Management, and Others.

Healthcare: Short-term health insurance is popular in healthcare, giving temporary medical protection. It helps people who are jobless, on short contracts, or traveling, by offering flexible and essential medical care when required.

Travel & Leisure: In the travel and leisure world, short-term insurance is vital for safeguarding folks on vacation or business trips. It takes care of travel hassles, medical crises, and other unplanned costs, making it a must-have for globe-trotters and tourists.

Automotive: People often use short-term automotive insurance when renting vehicles, borrowing cars, or needing temporary coverage. It's a budget-friendly choice for those who don't need long-term car insurance but want protection for a short time.

Event Management: Short-term insurance in event management covers weddings, conferences, and festivals. It safeguards event organizers from financial hits caused by cancellations, damages, or unplanned situations.

Others: The "Others" category covers a range of unique short-term insurance needs, like pet care, vacation homes, and seasonal job insurance. As consumer demands grow more varied, this area is constantly expanding, providing tailored protection for many different temporary scenarios. Now, more than ever, temporary insurance is tailored to meet a wide range of niche needs.

MARKET DYNAMICS

Market dynamics include driving and restraining factors, opportunities and challenges stating the market conditions.

Driving Factors

”Growth in Short-Term Insurance Demand”

Short-term insurance has grown a lot as consumers see its flexibility and affordability. They want cover for short times, especially in new markets, to protect against sudden events. Urbanization and changing lifestyles have boosted demand, with people being more mobile and needing short-term cover. Digital platforms have made short-term insurance easier to get, drawing in younger people who like on-demand services. More natural disasters and health crises are also making these policies more popular, pushing market growth.

Restraining Factor

”Regulatory Challenges and Limited Awareness”

A big problem for the short-term insurance market is the lack of the same rules in different places. Some markets have legal issues that make it hard to buy and sell these policies. Plus, consumers don't know much about short-term insurance. They don't see its benefits and flexibility over traditional insurance. This lack of knowledge holds back the market, especially in developing areas where insurance is not very common. Also, people think short-term insurance isn't stable in the long run, so they might not choose it.

Opportunity

”Expansion of Digital Platforms and On-Demand Services”

Technology's rapid pace offers big chances for the Short Term Insurance market to thrive. Digital platforms let insurance firms offer custom, on-demand policies that can be bought and handled online. This trend hits the spot with younger consumers who love digital interactions and want flexible, affordable solutions. AI and big data advancements help insurers assess risks better and tailor their offerings. The chance to get instant coverage for needs like short-term travel, health, or car rentals will boost short-term insurance demand. Plus, with gig and freelance work on the rise, the need for temporary, customizable insurance will keep growing, unlocking new market chances.

Challenge

”Balancing Affordability with Comprehensive Coverage”

Finding the sweet spot between affordability and full coverage is a big hurdle in the Short Term Insurance market. Short-term insurance boasts lower premiums than traditional policies, but many consumers may find the coverage lacking. Especially for health or auto insurance, short-term policies might not offer the same protection, risking dissatisfaction or financial woes if a claim arises. Providers must strike a balance, offering affordable short-term products with enough coverage to satisfy consumers. Plus, the short duration of these policies can leave gaps in coverage, turning off potential buyers. Tackling this challenge is vital for market growth and building consumer trust.

SHORT TERM INSURANCE MARKET REGIONAL INSIGHTS

North America

The Short Term Insurance market in North America has been steadily climbing, fueled by the rising need for flexible, on-demand insurance. Folks here are more often looking for coverage for temporary needs like travel, health, and cars, especially with the gig economy, freelancers, and frequent travelers on the rise. Digital platforms are crucial, as insurers offer quick, easy digital solutions for buying and managing policies. Temporary health insurance, especially during life changes like job shifts or short moves, has also boosted growth. Though the market is more developed than others, challenges persist, like regulatory gaps and differing state insurance laws that can affect short-term insurance's consistency and expansion.

Europe

Europe's Short Term Insurance market is slowly growing as consumers look for more flexible insurance choices. Places like the UK, Germany, and France are seeing a rise in demand for short-term health, travel, and car insurance. High consumer awareness and a strong digital setup help insurers offer quick, personal solutions. But, Europe's regulatory scene is complex, with different insurance rules in each country. This mix of rules has held back short-term insurance in some spots. Yet, despite these hurdles, the European market is set to expand, especially with the rise of on-demand services and more temporary health and travel coverage as consumers seek flexibility and cheaper options to long-term policies.

Asia

Asia's Short Term Insurance market is booming, thanks to growing economies, higher incomes, and a larger middle class. Nations like China, India, and Japan see a surge in short-term insurance demand across sectors like travel, health, and cars. Digital tools are vital here, with insurers using mobile apps and online platforms for on-demand policies. Yet, hurdles persist, like low insurance use in some countries and unawareness of short-term options. Despite these, the market is poised for rapid growth, as consumers seek affordable, flexible solutions, and the gig economy expands in India and China. Growing awareness and shifting tastes are pushing short-term insurance adoption, making Asia a promising market.

KEY INDUSTRY PLAYERS

”Competitive Landscape of the Short Term Insurance Market”

The Short Term Insurance market is competitive, with several big players offering tailored products for travel, health, and cars. Top firms like Allianz Global Assistance, AXA, and Travelers Insurance are boosting their digital platforms for quick, flexible, and cheap insurance. The rise of on-demand insurance, paired with mobile apps and online services, has heated up competition. Insurers are using advanced tech like AI and data analytics to assess risks and offer personal short-term cover. The market stays competitive, with established players and innovative firms like Lemonade Insurance, which uses digital-first tactics to draw tech-savvy customers. As short-term insurance demand grows, companies must adapt to shifting consumer tastes and regulatory hurdles to stay ahead.

List of Top Short Term Insurance Companies

Allianz Global Assistance
AXA
Travelers Insurance
Progressive Insurance
Cigna Global Health Insurance
Lemonade Insurance
Bupa Global
Zurich Insurance Group
State Farm Insurance
Generali Group

REPORT COVERAGE

The study encompasses a comprehensive SWOT analysis and provides insights into future developments within the market. It examines various factors that contribute to the growth of the market, exploring a wide range of market categories and potential applications that may impact its trajectory in the coming years. The analysis takes into account both current trends and historical turning points, providing a holistic understanding of the market's components and identifying potential areas for growth.

The Short Term Insurance market is booming, sparked by a surge in consumer demand for flexible, on-demand coverage. This is especially true in travel, health, and automotive sectors, where people look for cheaper temporary solutions over long-term policies. Digital platforms and mobile apps have added fuel to this fire, letting insurers provide quick, tailored policies for unique needs. Furthermore, the growth of the gig economy and freelance work has boosted the need for temporary coverage for those without traditional employer-provided insurance.

In the future, the short-term insurance market is set to keep growing, as consumers value flexibility and convenience more. With advanced digital platforms and AI technologies, personalized insurance options will improve customer satisfaction. Yet, regulatory hurdles and educating consumers are challenges that must be overcome for the market to thrive. Factors like travel, health, and vehicle rentals boost the demand for temporary coverage, giving insurers a big chance to expand their services and meet evolving needs.