Yahoo Finance Amazon launches online insurance portal for UK customers
Amazon (AMZN) has moved into a new business area, entering the UK insurance comparison market, with an initial focus on home policies.
The online portal, which launched on Wednesday, allows its users to shop for home insurance using third party providers. It currently has three insurers on board, but plans to add more next year.
It will initially provide shoppers with quotes from Co-op, LV= General Insurance and Ageas UK.
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The world’s largest online retailer called the insurance store "a new, simple, and convenient way for UK customers to shop for home insurance".
Amazon enters a crowded insurance comparison market alongside established platforms such as MoneySupermarket and ComparetheMarket, as well as banks, which often sell insurance alongside mortgages.
The Seattle-based company will receive a commission from the insurers for policies sold over the platform.
The Amazon Insurance Store will also show customer reviews, star ratings and claims acceptance rates for the insurers, similar to the other products for sale on the site.
"This is just the beginning," Jonathan Feifs, general manager of Amazon’s European payment products division said.
He added that he hoped the offering will simplify the insurance market by enabling customers on its UK site to select a policy, request and review quotes, and check out.
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It’s yet to be seen whether the company will expand into more markets or offer other types of insurance.
Amazon's insurance store could face competition from more established providers as consumer could prioritise value over efficiency, according to Susannah Streeter, senior analyst at Hargreaves Lansdown.
"As Amazon has shown in its retail marketplace, it may not be the cheapest supplier in town, but it's the ease of use that gives it the edge over the competition, particularly as it has a ready presence as an app on millions of phones," she said. "However, it may find the amid the cost of living crisis, consumers will prioritise value over efficiency, giving more resilience to price competitive rivals."
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