Amazon launches insurance comparison service in the UK

It's a new foray into financial services for the US e-commerce giant. The Amazon Insurance Store allows UK customers to buy home insurance by helping consumers compare quotes, choose a plan and pay for it using a payment experience integrated with Amazon.co.uk.

FACTS

• The Amazon Insurance Store currently offers three insurance companies: the British mutual group Co-op and two foreigners, the Dutch Ageas and the German Allianz via its local subsidiary LV = General Insurance. The addition of other insurers is planned for the beginning of next year.

• In beta mode for the moment, the platform is only available to Amazon customers. Users will be able to sign up for a service without leaving the site, as they are connected to their Amazon account.

• They will mainly find home insurance and insurance for various goods.

CHALLENGES

• Continuing its deployment in financial services: Amazon already offers financial products in the UK. In addition to gift cards and payment and credit cards, there are microcredit and split payment services, thanks to a partnership with Barclays Bank. This is not Amazon's first foray into the insurance market either. Last year, the company partnered with Superscript to offer members of its Business Prime programme content insurance, cyber insurance and professional liability insurance. In India, Amazon also sells car insurance with its partner Acko.

• Leveraging the customer experience to make a difference: The element with which Amazon seeks to differentiate its service is the questionnaire experience. The company has simplified the process by asking only the essential questions that insurers need to underwrite an offer. Once the Amazon Insurance Store gains traction, the company will incorporate elements that consumers have come to expect from Amazon, such as customer reviews, ratings and even claims rates. The company expects user-submitted data to help customers make more informed choices about insurance companies and policies.

MARKET PERSPECTIVE

• Amazon wants to establish itself in an already mature sector, against competitors such as GoCompare, Moneysupermarket, and Uswitch. In Germany, Check24's multi-service comparator now also includes insurance products such as those of Allianz Direct.

• This new model reflects a profound transformation brought about by the platformisation of the economy. But while this benefits these new players, it also poses many risks. After the EU, the United Kingdom has opened an investigation for abuse of a dominant position against the American giant and more specifically its algorithm which favours products from its "Buybox", which are more profitable for the company.