Extended Warranties and Insurance for Mobile and Non-Mobile Consumer Products in China

NEW YORK, Oct. 23, 2012 /PRNewswire/ -- Reportlinker.com announces that a new market research report is available in its catalogue:

Extended Warranties and Insurance for Mobile and Non-Mobile Consumer Products in China

http://www.reportlinker.com/p01020599/Extended-Warranties-and-Insurance-for-Mobile-and-Non-Mobile-Consumer-Products-in-China.html#utm_source=prnewswire&utm_medium=pr&utm_campaign=Phones_and_PDA

Extended Warranties and Insurance for Mobile and Non-Mobile Consumer Products in China is about the market for extended warranties and insurance sold in conjunction with white goods, brown goods, grey goods, mobile gadgets and mobile phones in China.

The study draws on extensive primary and secondary research covering 241 organisations involved in the production and distribution of mobile and non-mobile consumer products including manufacturers, mainstream mobile network operators, mobile virtual network operators (MVNOs), specialised retailers of consumer electronics, supermarkets and other types of retailer (namely, department stores, DIY outlets, speciality retailers and variety retailers). Hence, it provides a comprehensive overview of this activity across China.

Key features of this publication include:

- quantification of the market size for extended warranties and insurance linked to mobile and non-mobile consumer products: how much is the market likely to be worth in China, and how does it segment between white goods, brown goods, grey goods, mobile gadgets and mobile phones?

- analysis of extended warranty underwriters and brokers that have established scheme relationships with manufacturers and retailers of white goods, brown goods, grey goods, mobile gadgets and mobile phones, including their unweighted share of partnerships;

- consideration of the potential for cross-selling stand-alone extended warranty and insurance policies through independent channels that are separate from either manufacturers or retailers: does an emerging market exist for this form of distribution in China?

- forecasts for the market size for extended warranties and insurance linked to mobile and non-mobile consumer products up to 2015: assuming no significant changes in the number of manufacturer and retailer schemes, what factors will cause this sector to grow or decline in the next few years?

TABLE OF CONTENTS

0.0 EXECUTIVE SUMMARY . 1

1.0 INTRODUCTION 3

What is this report about? 3

Rationale . 3

The market for extended warranties and insurance for consumer products has been little studied 3

Two major subsidy schemes related to consumer goods are likely to impact several markets . 3

Evolving distribution channels both favour and compromise extended warranty provision . 4

Methodology . 4

Manufacturer and retailer survey . 4

The survey's scope covers 241 manufacturers and retailers of mobile and non-mobile consumer products . 4

Market data . 4

Distribution channels for retailers . 5

Bricks-and-mortar retail is still a major factor in the distribution of consumer products in China 5

Definitions . 6

Extended warranties and insurance 6

Extended warranties and insurance linked to consumer products come in a variety of formats… 6

…and are frequently marketed to consumers under alternative titles . 6

Premiums and other revenues . 7

Operating models . 7

PartnerBASE™ and market data annexe . 8

Finaccord 8

2.0 WHITE GOODS 11

Introduction . 11

Underlying market value and volume 12

Sales of white goods grew by over USD 30 billion between 2007 and 2011 12

Manufacturers' original warranty length and consumer law. 13

One-year warranties are the standard coverage offered for white goods . 13

Manufacturer schemes for extended warranties and insurance . 14

Just over 10% of manufacturers offer an extended warranty on white goods 14

Retailer schemes for extended warranties and insurance . 15

Just under a third of retailers offer extended warranties on white goods 15

NEW Corp and The Warranty Group maintain the largest number of partnerships… . 15

…followed by Assurant and a national service and repair provider . 15

Risk coverage of all schemes for extended warranties and insurance . 17

Over a third of schemes provide coverage for accidental damage . 17

Independent distribution channels 17

Several organisations offer extended warranties for white goods away from point-of-sale 17

Market value for extended warranties and insurance 18

Market forecasts to 2015 . 19

The white goods market is forecast to experience continued growth through to 2015… . 19

.which will help boost the market for extended warranties . 20

3.0 BROWN GOODS 21

Introduction . 21

Underlying market value and volume 22

The volume of brown goods sales increased by half between 2007 and 2011 22

Manufacturers' original warranty length and consumer law. 23

Only three manufacturers offer an original warranty longer than one year . 23

Manufacturer schemes for extended warranties and insurance . 24

A similar number manufacturers offer extended warranties for brown goods as for white goods 24

Retailer schemes for extended warranties and insurance . 25

Two thirds of retailers offering extended warranties use external partners for their provision… 25

…with the partnerships almost identical to those found for white goods . 25

Risk coverage of all schemes for extended warranties and insurance . 27

Schemes provide cover only against technical or mechanical failure . 27

Independent distribution channels 27

Several organisations offer extended warranties for brown goods away from the point of sale 27

Market value for extended warranties and insurance 28

Market forecasts to 2015 . 29

China's market for brown goods is predicted to continue to enjoy strong growth. 29

…which should continue to drive growth in the market for extended warranties 30

4.0 GREY GOODS 31

Introduction . 31

Underlying market value and volume 32

China's grey goods market value fell on flat volumes between 2007 and 2011 . 32

Manufacturers' original warranty length and consumer law. 33

One third of manufacturers offer more than a single-year warranty 33

Manufacturer schemes for extended warranties and insurance . 34

Manufacturers of grey goods that offer extended warranties do so exclusively via internal provision . 34

Retailer schemes for extended warranties and insurance . 35

External partnership is the preferred type of extended warranty scheme among grey goods retailers… . 35

…with NEW Corp once again holding the most individual partnerships . 35

Risk coverage of all schemes for extended warranties and insurance . 37

One third of schemes covers accidental damage to grey goods . 37

Independent distribution channels 38

Several third-party specialist extended warranty and insurance providers are found for grey goods 38

Computer repair companies commonly offer service contracts which function as extended warranties . 38

Market value for extended warranties and insurance 39

Market forecasts to 2015 . 40

The market for grey goods is forecast to show modest growth through to 2015. . 40

…which will translate into an even more modest increase in the size of the extended warranty market 41

5.0 MOBILE GADGETS . 42

Introduction . 42

Underlying market value and volume 43

China's mobile gadget market value and volume increased by more than half between 2007 and 2011 . 43

Manufacturers' original warranty length and consumer law. 44

Almost all manufacturers offer only a one-year warranty for mobile gadgets . 44

Manufacturer schemes for extended warranties and insurance . 45

Manufacturers of mobile gadgets in China adhere exclusively to internal provision . 45

Retailer schemes for extended warranties and insurance . 46

Eight retailers manage their extended warranty and insurance provision internally. 46

. with the remaining retailers all using external providers for their extended warranty programs . 46

Risk coverage of all schemes for mobile gadget insurance 48

The great majority of coverage is limited to mechanical or technical fault only . 48

Independent distribution channels 48

Coverage options for mobile gadgets are almost the same as for grey goods . 48

Several gadget repair companies commonly offer service contracts which function as extended warranties 49

Market value for extended warranties and insurance 49

Market forecasts to 2015 . 50

The mobile gadget market is forecast to continue its strong growth through to 2015. 50

…with the corresponding extended warranty and insurance market forecast to grow commensurately. 51

6.0 MOBILE PHONES 52

Introduction . 52

Underlying market volumes . 53

The volume of mobile phone subscriptions increased by 78% between 2007 and 2011. 53

.while the number of individuals in possession of a mobile phone also experienced very substantial growth 54

Manufacturers' original warranty length and consumer law. 55

No manufacturer of mobile phones offers an original warranty longer than one year 55

Manufacturer schemes for mobile phone insurance 56

Only three manufacturers offer extended mobile phone cover 56

Retailer schemes for mobile phone insurance . 57

China's state-owned mobile networks do not offer mobile phone insurance or warranties 57

Once again, NEW Corp is the most commonly reported external provider…. 57

…with The Warranty Group and Assurant also named by multiple retailers 57

Risk coverage of all schemes for mobile phone insurance . 59

Coverage for loss or airtime abuse is not a feature of retailer-distributed insurance programs in China . 59

Independent distribution channels 60

Coverage options for mobile phones differ somewhat from those for mobile gadgets . 60

A number of companies specialise in third-party coverage for mobile phones… . 60

…while several companies mentioned in conjunction with other categories also cover mobile handsets 60

Market value for mobile phone insurance . 61

Market forecasts to 2015 . 62

Mobile phone subscriptions are forecast to increase by over 20% between 2011 and 2015. . 62

.which would equate to a penetration rate among consumers reaching 70% 63

Increasing take-up and market penetration should help buoy the mobile phone insurance market 64

LIST OF GRAPHICS / TABLES

0.0 EXECUTIVE SUMMARY . 1

Approximate market value for extended warranties and insurance linked to mobile and non-mobile consumer products in China, 2011 and 2015 (forecast) 2

1.0 INTRODUCTION 3

Organisations researched segmented by type . 5

Retailers segmented by distribution channel, 2012 . 6

2.0 WHITE GOODS 11

Comparative length of original warranties offered by manufacturers of white goods in China, 2012 . 13

Manufacturer schemes for extended warranties and insurance linked to white goods in China: provision rates and operating models, 2012 . 14

Retailer schemes for extended warranties and insurance linked to white goods in China: provision rates, operating models and provider share of non-captive partnerships, 2012 . 16

Risk coverage of all schemes for extended warranties and insurance linked to white goods in China, 2012 . 17

Approximate market value for extended warranties and insurance linked to white goods in China, 2011 . 18

Value and volume of sales of white goods in China, 2011 and 2015 (forecast) . 19

Forecast market value for extended warranties and insurance linked to white goods in China, 2015 . 20

3.0 BROWN GOODS 21

Comparative length of original warranties offered by manufacturers of brown goods in China, 2012 23

Manufacturer schemes for extended warranties and insurance linked to brown goods in China: provision rates and operating models, 2012 . 24

Retailer schemes for extended warranties and insurance linked to brown goods in China: provision rates, operating models and provider share of non-captive partnerships, 2012 . 26

Risk coverage of all schemes for extended warranties and insurance linked to brown goods in China, 2012 27

Approximate market value for extended warranties and insurance linked to brown goods in China, 2011 28

Value and volume of sales of brown goods in China, 2011 and 2015 (forecast) . 29

Forecast market value for extended warranties and insurance linked to brown goods in China, 2015 30

4.0 GREY GOODS 31

Comparative length of original warranties offered by manufacturers of grey goods in China, 2012 . 33

Manufacturer schemes for extended warranties and insurance linked to grey goods in China: provision rates and operating models, 2012 . 34

Retailer schemes for extended warranties and insurance linked to grey goods in China: provision rates, operating models and provider share of non-captive partnerships, 2012 . 36

Risk coverage of all schemes for extended warranties and insurance linked to grey goods in China, 2012 . 37

Approximate market value for extended warranties and insurance linked to grey goods in China, 2011 39

Value and volume of sales of grey goods in China, 2011 and 2015 (forecast) 40

Forecast market value for extended warranties and insurance linked to grey goods in China, 2015 . 41

5.0 MOBILE GADGETS . 42

Comparative length of original warranties offered by manufacturers of mobile gadgets in China, 2012 44

Manufacturer schemes for extended warranties and insurance linked to mobile gadgets in China: provision rates and operating models, 2012 . 45

Retailer schemes for extended warranties and insurance linked to mobile gadgets in China: provision rates, operating models and provider share of non-captive partnerships, 2012 47

Risk coverage of all schemes for mobile gadget insurance in China, 2012 . 48

Approximate market value for extended warranties and insurance linked to mobile gadgets in China, 2011 . 49

Value and volume of sales of mobile gadgets in China, 2011 and 2015 (forecast) . 50

Forecast market value for extended warranties and insurance linked to mobile gadgets in China, 2015 51

6.0 MOBILE PHONES 52

Volume of mobile phone subscriptions and subscriptions per capita in China, 2007 and 2011 53

Number of individuals owning a mobile phone in China and their weighting within the total population, 2007 and 2011 . 54

Comparative length of original warranties offered by manufacturers of mobile phones in China, 2012 . 55

Manufacturer schemes for mobile phone insurance in China: provision rates and operating models, 2012 . 56

Retailer schemes for mobile phone insurance in China: provision rates, operating models and provider share of non-captive partnerships, 2012. 58

Risk coverage of all schemes for mobile phone insurance in China, 2012 59

Approximate market value and policies in force for mobile phone insurance in China, 2011 . 61

Volume of mobile phone subscriptions and subscriptions per capita in China, 2011 and 2015 (forecast) . 62

Number of individuals owning a mobile phone in China and their weighting within the total population, 2011 and 2015 (forecast) . 63

Forecast market value and policies in force for mobile phone insurance in China, 2015 64

To order this report:

Phones_and_PDA Industry: Extended Warranties and Insurance for Mobile and Non-Mobile Consumer Products in China

Nicolas Bombourg
Reportlinker
Email: [email protected]
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