Reports have been circulating that online retail giant, Amazon, is considering dipping its toes into the world of home insurance, causing brief unrest in the existing market.
The report was initially released by The Information who claim the tip off came from a reliable, but anonymous, source. Although nothing has been confirmed, Amazon have not released an immediate comment on the matter. However, the news has already rocked the insurance market, with CNBC reporting shares in both AIG and Chubb fell slightly upon the reports release. Both have since returned to normal, but it is an indication of what could happen, should Amazon decide that home insurance is on the cards.
The retail juggernaut has already changed the way consumers shop, offering an alternative way of sourcing everything from fashion to groceries, and this isn’t the first time the Seattle-born company has hinted at its interest in a new market.
Despite this, at the S&P Global Ratings insurance conference, where some of the top U.S. names in the industry gathered earlier this month, businesses were told not to worry. Deutsche Bank AG analyst, Joshua Shanker, said that if Amazon did decide to venture into the insurance industry, it would start small with a “simple, bare-bones” approach. He also posed the question: “Does Amazon really want to get regulated? I don’t think they do.”
If Amazon does decide to confirm the rumours, it seems that customers would be willing to put their trust in them. In fact, The 2018 World Insurance Report revealed that 29.5% of customers would be willing to buy at least one product from a major tech firm, such as Amazon. This figure has risen since 2015, perhaps due to Amazon’s continued growth in becoming a household name.