You Can Now Buy Your Home Insurance Through Amazon?
Amazon is making a foray into the finance sector and offering UK residents options to buy third-party home insurance from the Amazon Insurance Store.
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For the first time, e-commerce giant Amazon has entered the home insurance game. People in the UK can now visit the Amazon Insurance Store, a service that provides home insurance policy quotes from third-party insurance providers. So far, this financial service is only available in the UK and offers quotes from three carefully selected UK home insurers including Ageas, Co-op and LV+ General Insurance.
Amazon made the announcement on Wednesday that it was expanding its reach into the financial services market. The services it provides are similar to other price comparison sites, including Moneysupermarket and Comparethemarket. The prospect could be lucrative for the e-commerce titan as it will receive a commission from each policy sold through the new online insurance store.
Currently, Amazon has only opened the service to a small number of customers but plans to open access to the entire United Kingdom by the end of 2022. Shoppers who opt to use the service will fill out a simplified questionnaire to help Amazon determine their home insurance needs, then they will receive a list of quotes from participating insurers. After reviewing each quote’s details—and checking out other customers’ star ratings and reviews—shoppers can choose a policy and check out through an easy online process.
In a press release, Amazon’s general manager of European Payment Products Jonathan Feifs said, “Finding the right home insurance policy can be a time-consuming and confusing task, with quotes that often leave out essential coverage in order to lead with the lowest price…We wanted to improve the experience for customers shopping for home insurance so they could easily compare options and make an informed, objective decision—just like shopping on Amazon.”
Amazon already has some experience in the world of finance. Last year, the company began providing insurance for small and medium-sized businesses in the UK. These policies were discounted by 20% and included contents insurance, cyber insurance, and professional indemnity insurance.
Other Amazon financial services include product warranties and “buy now, pay later” loans also called layaway plans. These layaway loans allow customers to pay off purchases in a series of monthly installments instead of having to pay the full amount up front. In the U.S., Amazon provides layaway through the fintech company Affirm and, in the UK, through Barclays bank.
Although the online retailer enjoyed huge profits during and immediately after the COVID-19 outbreak, its company shares have fallen over 30% in 2022. Amazon’s new forays into the world of finance are one way the company is trying to boost its revenues while facing the possibility of a worldwide recession. In the UK particularly, Amazon is facing a bleak holiday shopping season due to fears that gas supply disruptions from the Russia-Ukraine war will cause nationwide blackouts this winter.
Amazon’s additional recovery measures include their recent U.S. price hike on Prime membership services, from $119 to $139 per year. In the United Kingdom, the cost of an annual Prime subscription rose 20%, from £79 to £95. In France, the hike was a whopping 43%, jumping from 49 euros to 69.90 euros, but the company noted that it was the first Prime membership price increase since 2018.
UK customers who buy home insurance through the Amazon Insurance Store can use the Amazon app to change their payment method or view renewal information. In 2023, Amazon plans to add more insurance company partners to expand customers’ choices when selecting a home insurance provider. It’s also sweetening the deal by giving people who buy qualifying plans a £10 Amazon gift card.
