Amazon makes insurance move
Amazon has made another definitive move into the insurance world by investing $12m into an Indian digital insurance start-up.
It’s also been reported that the ecommerce giant is now also recruiting insurance professionals in London with a view to disrupting the markets in the UK and other western European countries.
According to Business Insider, Amazon has backed Acko to the tune of $12m. Acko, founded in 2016, offers car, bike and mobile insurance. It also provides passenger insurance for Uber-rival Ola, which covers riders for everything from minor accidents to missing a flight due to traffic delays.
It is predicted that Amazon will work with Acko on ecommerce coverage, with gadget protection being a potential focus initially.
Meanwhile, data and analytics company GlobalData has reported that Amazon is also now looking to establish a team of insurers in London. Its own report last year found that 18% of consumers would buy insurance from Amazon.
Patricia Davies, financial services analyst at GlobalData, said, ‘Amazon has a positive reputation for putting customers’ needs at the heart of its propositions. This level of trust is something the insurance industry has really struggled with, especially after the likes of the PPI scandal.
‘The company is in a good position having established itself as a key service provider for households with its Prime service, as well as offering a TV channel and movie service. We are already seeing a number of new propositions moving away from annual renewal to a monthly subscription basis, which would fit well with Amazon’s current business model.’
She added, ‘If insurers are not careful they may be pushed out of having a direct relationship with customers and will be relegated to the role of a price-driven risk carrier at the back end. Either way this is a sure sign disruption is on the way for the UK insurance market.’