Amazon has made no secret of its intent to disrupt virtually every industry on the planet, most recently announcing a partnership with JPMorgan Chase and Berkshire Hathaway to create an independent healthcare company. Reportedly, the retail giant has also begun to explore the idea of setting up an insurance price comparison site in the UK.
The formula is now clear. Amazon and other consumer-first digital disruptors like Google set their sights on a conventional industry with ageing distribution and marketing channels, then things start to change rapidly. With an insurtech revolution already starting to brew in the home insurance marketplace, how long will it be before the likes of Amazon and Google enter the market in a serious way? And, if they do, will customers welcome them?
While industry incumbents like State Farm, Allstate and Progressive have begun to speculate on potential scenarios for this kind of digital disruption, J.D. Power’s P&C insurance industry practice went right to the source – the consumer – to ask how real home insurance customers would feel about the presence of tech companies in this space.
Following were the key findings from the J.D. Power Pulse Survey, 20% of consumers would use Amazon or Google for home insurance. The data revealed that 20% of consumers would use an Amazon or Google for their home insurance. Millennials showed even higher interest at 33% for Amazon and 23% for Google. Of those that indicated that they would be willing to switch, 80% currently have insurance with the large national carrier.
Furthermore, the survey found that 75% of consumers are interested in home Telematics. While most of the media’s attention has focused on the future of automation technology in automobiles, the disruption to your home experience – and by extension, your home insurance – through smart home technologies are likely to have an equal or greater impact.
Smart home technologies are revolutionising many areas of the home, from simple comfort features that can now turn lights on and off or access in-home entertainment by control of your phone to home security and emergency support with automatic shutoffs and alerts.
The insurance industry is taking notice and wants in on the action. Insurers see smart home technologies as an opportunity to deepen their relationships with customers, while at the same time improving home coverage options and underwriting. While leading home insurance carriers have begun to venture into these areas, not much research has been done to understand the consumer’s demand for as these features become available.
Written from press release by Leah Alger