Briefing: Amazon insurance, is it really that different?

By Matt Scott 

It took a long time coming, but when Amazon finally launched its insurance store in October last year, it wasn’t exactly announced with the fanfare many would have expected.

Instead, Amazon’s insurance offering, which had been rumoured to be in the offing since before I started in the insurance industry more than a decade ago, launched with a panel of just three insurers – Ageas LV= and The Co-op.

Unsurprisingly, it was home insurance that the online shopping giant set its eyes on, offering contents, buildings and a combined contents and buildings policy, initially just to a select few customers in the UK.

Since then, the insurance store has been opened up to the general public, and earlier this month Policy Expert was added as the fourth member of Amazon’s panel.

The MGA has been growing fast in recent years, with parent company Qmetric Group reporting revenues of almost £76m in its latest set of accounts, according to analysis from Insurance DataLab.

This growth represents more than double the £37m of revenues reported three years prior.

And Policy Expert will be hoping that its presence on Amazon’s insurance store will add further fuel to its growth, although the evidence to date suggests that Amazon’s entrance into the market is not making the waves many in the industry will have feared when the store was first announced.

A slow start

At the time of writing this briefing, the four insurers on the Amazon insurance store had only received 10 reviews in total – and that’s across all three cover types.

The Co-op has received the most reviews with eight – six for its contents only policies and two for its combined policy – while Ageas and LV= had received one solitary review each – both for the combined contents and buildings policy.

None of the insurers on Amazon’s insurance store had received any reviews for their buildings only policies.

Interestingly, none of the insurers are yet to have received enough claims from the policies sold through Amazon to publish their claims acceptance rates, something that Amazon had cited as one of the main points of difference for its offering compared to the rest of the insurance market.

Without such information – and with the number of customer reviews still so limited – it is hard to see what makes Amazon any different to the other price comparison services out there.

Indeed, the quote journey, while possibly slightly more streamlined than some of the aggregators, is not exactly groundbreaking.

It still looks and feels very much like a traditional insurance user journey and when researching this article I was required to enter the exact same information – including a lot of information that Amazon already holds on my account – three separate times in order to receive a quote for each of the policy types.

But slow and steady wins the race, as the saying goes, and Amazon certainly remains committed to its insurance store. Once volume of policy sales does start to filter through, the reviews and claims acceptance rates could make for interesting reading, particularly in the age of Fair Value and Consumer Duty.

For now, however, it still remains to be seen what impact Amazon will have on the UKGI market. And I, for one, will be keeping a very close eye to see what happens next.