Amazon.com Inc. is launching a home insurance portal in Britain and has signed up three big-name insurers as it pushes further into financial services across the globe.
Ageas UK, Co-op, and LV= General Insurance, a unit of German insurer Allianz, will provide third-party services initially, Amazon said on Wednesday, and it hopes to add more insurers “early next year.”
Moneysupermarket.com’s shares slumped more than 15% following the news.
“Amazon will be a major threat if it earnestly invests and focuses its efforts in this market,” Peel Hunt analysts said, adding that insurance – including home insurance – makes up around 43% of Moneysupermarket’s business.
Moneysupermarket said earlier this week it expected annual core profit to be at the upper end of market views, as the cost-of-living crisis in Britain focused consumers’ minds on saving money.
Other firms operating comparison sites include Uswitch, Compare the Market and GoCompare, owned by Future, whose shares fell by more than 3%.
Last year, 29.4% of UK consumers bought household insurance through price comparison sites in Britain, according to analytics firm GlobalData.
Insurers worry that tech firms will steal a march on their business, and are keen to partner with them, offering them commissions for selling their products.
The Amazon portal was “an exciting move for the industry,” said Simon Hird, partnerships director at LV= General Insurance.
The site would give insurance customers more choice over how they buy cover, said Charles Offord, managing director, Co-op Insurance, while Ageas UK CEO Ant Middle said the insurance market needed “new and progressive digital distribution platforms” like Amazon.
Amazon has been considering launching a comparison website in Britain for several years. Reuters reported exclusively on its plans in 2018.
The new portal, Amazon Insurance Store, will also include customer reviews and ratings on insurance companies and the rate at which the claims were accepted for policies offered, Amazon said.
Amazon partnered with Lloyd’s broker Superscript last year to offer insurance to small and medium-sized UK business customers.
It started offering motor insurance in India in 2020 through Acko General Insurance and also provides product warranty insurance in Europe.
It also launched a buy-now pay-later scheme in Britain with Barclays last year.
(Reporting by Rhea Binoy in Bengaluru and Carolyn Cohn in London, editing by Elaine Hardcastle, Philippa Fletcher, Alexandra Hudson)