It’s been a rumour in the insurance sector for years; Amazon are to launch a comparison website to take on the Meercats, Winston Wolf and that shouty opera singer bloke. Yesterday the mainstream UK media ran with the story, so perhaps the online retail giant is close to launching something in 2019?
Chief Finance Officer for Admiral, Geraint Jones, told Reuters that the company would be `interested in becoming a member’ if Amazon did launch a price comparison site. Most insurance sector observers seem to think that Amazon will look at home contents, gadgets and perhaps extended warranty products first of all, maybe selling a significant percentage of their services via the Echo.
Meanwhile analysts GlobalData also see Amazon’s entry as a potential pertnership opportunity for UK insurers;
Danielle Cripps, Insurance Analyst at GlobalData, offers her view on the breaking news;
‘‘Amazon has so far been seen as a threat and source of competition by UK insurers, but this move would see the company become a distribution business partner to the sector.
‘‘The aggregator market has lacked innovation over recent years to which Amazon could bring something new. Some insurers could seek to build their relationship further, adding insurance skills to Amazon Alexa or using Amazon’s marketplace of products such as smart home devices or wearables to further their product offerings.
‘‘However, Google launched a similar product in 2016 with limited success. Google and Amazon have similar profiles as giant tech players and there is not an obvious factor as to why Amazon would fare better, but its entry into the insurance industry is certainly more timely.
‘‘Insurance was relatively unaffected by the Fintech wave in 2016, with few outside players having established themselves. However, InsurTech has progressed significantly since then, with even Amazon itself having created relationships with Aviva through its Alexa device.’’
Amazon has become the first stop for buying almost anything in the UK and many other countries. Customers trust it and generally, it delivers on its promises. That alone should make the insurance industry raise its game when it comes to clarity on cover, settlement of claims and most important of all, offering the human touch when it comes to customer experience.
That essential difference between Amazon’s Echo, MS Cortana, Apple’s Siri and real human beings, especially during moments of crisis such as accidents or bereavement, is where insurers can always win over the convenience of online comparison sites, often powered by chatbots and automated call handling systems. By all means partner with Amazon, but remember to sell on brand values, reputation and – crucially in the UK – your company’s readiness to actually pay taxes, not hide them on the global merry-go-round of avoidance.
That factor, more than anything, will be the eventual downfall of Amazon; it expects others to pay for the infrastructure, healthcare and education systems that deliver its products and services.