Amazon is in talks with firms across Europe to see if they would contribute to an Amazon insurance comparison site.
According to Reuters, the venture into the UK insurance sector is currently in the middle of “several discussions” but there were no imminent launch plans.
With regards to what type of insurance will be offered, it is unclear. However, UK insurance comparison sites offer everything from motor to life to home insurance.
When approached, Amazon declined to comment.
The effects of an Amazon insurance site
Ben Carey-Evans, GlobalData insurance analyst, commented: “Google launched a similar product in 2016 with limited success. Google and Amazon have similar profiles as giant tech players and there isn’t 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.”
Danielle Cripps, life and pensions insurance analyst at GlobalData, added: “This is interesting news from Amazon. So far, it has been seen as a threat and source of competition by UK insurers, but this move would see Amazon instead as a distribution business partner.
“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.”
Stuart Rye, director business development, financial services at Fujitsu, said: “Given the busy UK market, the question is whether Amazon can actually disrupt existing aggregators. As the insurance aggregation market in the UK is already pretty mature, very competitive, rapidly evolving and improving, driven by digital native tech companies, other companies – such as Tesco and Google – have tried and failed before.
“If Amazon has any unique value over them, this is more likely to come not from technical prowess but from value chain integration, given the digital depth and breadth of Amazon.”
Amazon leaving its comfort zone?
While this is the first sign of an Amazon insurance comparison site, this is the latest of Amazon’s moves outside of online retail. In January 2018, Amazon entered the US healthcare market.
Amazon, Berkshire Hathaway, and JPMorgan (three of the largest private employers in the US) collaborated to create a healthcare company with the aim of cutting healthcare costs and improving services for their US employees. The aim was to address the issue of rising healthcare costs in the US, and to offer simple, transparent, lower-cost healthcare by utilising technology.
A month after Amazon’s announcement, Apple announced that it was preparing to launch a network of “AC Wellness” medical clinics for its employees and their families in spring 2018.
This is not the first time an online retailer or tech companies have entered the healthcare industry. While Amazon’s announcements are new to the European and US markets, Alibaba has already made similar moves.
Alibaba’s subsidiary, Ali Health, provides a range of health services. These include health insurance, medication delivery, a doctor network, and AI-assisted diagnosis tools.