There is no reason for insurance carriers to panic (yet, at least). Amazon is currently just in the exploratory stages of entering the insurance space. And if the company does choose to get into the insurance market, it will likely just begin by offering basic, bare-bones coverage.
The homeowners’ insurance market could be a lucrative one for Amazon to disrupt. Just last year insurance carriers in the U.S. and Canada generated $92 billion in premiums from homeowners’ insurance policies. However, considering that the industry is heavily regulated and customers’ sense of loyalty to their existing insurance carriers, disrupting the market won’t be an easy task for Amazon.
Amazon’s Decision to Enter the Insurance Market is Not Definitive
We’ve seen Amazon make moves into other highly regulated industries without jumping in. For example, Amazon acquired licenses in multiple states to be a wholesaler of healthcare goods, but no further action has been taken. We very well could see the same thing happen with Amazon’s consideration of entering the homeowners’ insurance market.
Most likely, if Amazon does choose to enter the insurance space, it would act as a brokerage platform and guide consumers’ to insurance carriers for a cut of the premium in return. Another edge that Amazon could have on its competition in the insurance market is a wealth of consumer data to use for pricing.
However, considering that many homeowners choose to have their homeowners’ insurance policies wrapped into their mortgages, this type of coverage is not frequently shopped. Therefore, insurance carriers shouldn’t start fretting yet about the potential for Amazon to enter the insurance space.
How an Insurance Inspection Gives Carriers a Competitive Edge
Traditional insurance carriers have another leg up on Amazon and InsurTech companies by offering an in-person insurance inspection. While today’s consumers value the convenience that technology offers, the convenience factor still does not outweigh the value that a face-to-face insurance inspection provides.
Our team at Insurance Risk Services has been partnering with homeowners’ insurance carriers for more than 35 years to provide them with a thorough, in-person insurance inspection to use for underwriting purposes. Completing an insurance inspection will help you to establish relationships, build consumer loyalty, and more accurately assess risk.
Contact us at Insurance Risk Services to learn more about our insurance inspection process and how you can use it as a tool to give your business a competitive edge.