A recent article written by Anthony O’Donnell on Insurance Innovation Reporter discusses how AT&T’s new commercial for their Digital Life service should make insurers nervous. The Digital Life service is basically a home security and automation system at your finger tips; allowing you to check status of your home via your cell phone. O’Donnell recognizes that if AT&T has found a way to move into the home security business what’s to say they won’t move into the insurance world creating non-traditional competition for insurance companies.
In another article written earlier this fall Linda Koco of InsuranceNewsNet writes, “Where do Google and Amazon fit in? Almost two-thirds (64 percent) of the executives believe this intensified competition in insurance distribution will come from non-insurance players such as Google, or e-commerce giants like Amazon. Since both Google and Amazon conduct sales worldwide over the Internet, they already have an international infrastructure in place, making the idea of an internet firm/insurance firm partnership feasible regardless of country.” This is an idea that we have been exploring for a while.
At the StoneRiver Summit back in September our own Ernie Hursh gave a presentation on this exact topic called “What if Amazon Sold Insurance?”. In the presentation Ernie discussed that consumers are taking charge and the idea of any time, any where, any channel is becoming a reality, and how the merger of consumer buying behavior, big data, and the Amazon (consumer) model are going to make a difference in the insurance industry.
While recent studies have shown that most people like shopping for insurance quotes online but prefer to speak to a person when purchasing the product, keeping agents at the center of the action, we believe it won’t be long until automated online buying via non-traditional companies will be the norm.