What to do about Amazon?
Rumors and debate abound in the UK property and casualty (P&C) insurance market about what Amazon’s intentions are for this industry, especially after the furor that has been caused over the last several months by observers noting the company’s hiring campaign to attract experienced insurance professionals. According to Shai Wininger, Co-founder and Chief Lemonade Maker at Lemonade, Amazon has been actively poaching people from his team, enticing them with “obscene” amounts of money. The company’s recent partnership with Berkshire Hathaway and JP Morgan Chase to disrupt the healthcare insurance industry is only lending fuel to the fire.
Naturally, the key question is what is Amazon’s intent? Will it merely extend its existing warranty business, branded Amazon Protect? Will Amazon become an aggregator? Will Amazon become a distributor of insurance, underwriting itself or via white-labelling products from conventional insurers? If Amazon sells insurance, what products will they provide? Where, ultimately, do their ambitions lie? Insurers are stressing about these questions, and they are right to do so, not just in the hyper-competitive U.K. market, but globally. Amazon is a frightening competitor, has the power to change industries, and apparently only funds internal initiatives that have a realistic chance of reaching $1B in revenue.
To learn about what insurers can do to reduce their worry about what Amazon will do and how to use it to their advantage instead, please read my Insurance Innovation Reporter article.
Guidewire can help you with some of these strategic questions. We make money from selling software. But our mission – what drives us – is to help the P&C insurance industry adapt and succeed at a time of rapid change. We have helped many of our 330+ customers in refining their strategy and getting the most out of our software in service of their journey.