Financial services

Amazon launches UK insurance portal as part of latest financial services campaign

Amazon is launching a portal to buy insurance in the UK, defying established price comparison sites in the latest indication of Big Tech’s growing ambitions in financial services.

Wednesday’s unveiling of Amazon’s home insurance comparison service comes a week after Apple announced a new high-yield savings account with Goldman Sachs.

Amazon already offers online payments, co-branded credit cards, gift cards and installment loan services, including a “buy now, pay later” partnership with Barclays in the UK.

In insurance, it offers warranty extensions for certain products purchased through its online store and, in India, car insurance through a partnership with Acko.

But the launch of a UK insurance aggregator could pave the way for a broader push for personal finance products in one of its biggest markets outside the US.

Jonathan Feifs, Amazon’s general manager for payment products in Europe, said Wednesday’s launch of home and building contents insurance was “just the beginning.”

“There are certainly opportunities to improve other insurance shopping experiences as well,” he said.

The Seattle-based e-commerce giant hopes to succeed where rival Google failed in online comparison sites. Google Compare, a car insurance, credit card and mortgage comparison tool, was shut down in 2016 after operating for several years in the UK and a year in the US.

Amazon wants its portal to be a direct competitor to sites such as Moneysupermarket, Uswitch, Compare the Market and GoCompare, although it currently only has three insurers.

It will allow customers to compare and purchase buildings and contents insurance from a range of providers, without leaving its website. Its first three partners are Ageas, Co-op and LV, with more suppliers promised “early next year”. The portal will also allow customers to review their suppliers.

Amazon will earn a commission on each sale and said customer data collected during the application would be segregated from the company’s other business units, including its fast-growing advertising division and its Ring home security cameras.

Feifs said it would only select vendors who meet the “Amazon Coverage Standard,” which includes timelines for handling claims as well as coverage for the most common claims, and that pricing was “not part of the discussion”. “We are far from bringing all comers to the Amazon Insurance Store,” he said.

Britain has long been one of the world’s busiest markets for price comparison sites, unlike the US where most insurance is purchased directly.

Online aggregators have generally benefited from the cost of living crisis as customers shop for savings. Moneysupermarket shares rose 7.5% on Tuesday after it reported third-quarter deals ahead of expectations.

However, the industry continues to adapt to new regulations that came into effect earlier this year. These rules prevent “price walking”: a gradual increase in premiums as customers renew each year, which had encouraged change in the past.

UK price comparison sites have seen consolidation over the past couple of years. UK magazine publisher Future completed its acquisition of GoCompare for £594 million in February 2021. Two months later, Silver Lake-owned ZPG, which owns Uswitch and property site Zoopla, acquired from Admiral Group for £508 million.