Amazon U.K. Set to offer Home Insurance: Should Brokers be Worried?
Online retail giant Amazon is set to offer home insurance to consumers in the U.K. soon, worrisome news for brokerages who don’t have a solid digital strategy in place.
The looming question for brokerages at this stage is: should they be worried? The resounding answer is yes: if they are not prepared to compete in the insurance space with adequate tools, they better get started.
Amazon Plans to Move into Home Insurance
Amazon’s Insurance Store, set to open online for people in the U.K., is the Seattle-based tech company’s latest move into the insurance sector. Amazon has been dabbling in insurance services for several years, with its first offering of small and medium-sized business insurance in the U.K. in 2019.
While Amazon has only three insurers on board to target the home insurance market, brokers need to be ready at the gate to compete, as Amazon already has a leg up over brokerages, with ease of use and a large market presence.
3 Ways Brokerages can Compete with Amazon in the Insurance Space
If you’re a brokerage, here are 3 strategies to help you keep pace with Amazon’s expansion into the insurance sector.
Harness The Power of Data.
Brokers must start using data to improve operations and the customer experience. A brokerage must learn to use data to increase the efficiency of their operations, to improve selling its products, and to enhance the insurance policy renewal experience for the customer.
Meet Customers Where They Are.
Brokers should be able to meet the customer where they are, essentially offering maximum convenience when purchasing insurance. How? Brokerages need to develop technology that enables them to offer insurance where the customer wants it, when they want it. For example, instead of customers calling to change or renew a policy, the technology must be in place to offer insurance products in other environments, including dealerships, mortgage lenders, or when a consumer is buying a recreational vehicle. The key is having your product in front of the consumer before they even think to search for it.
Invest in Branding.
A brokerage that invests time and money into their branding will be better known to their customers and thus provide their existing and potential customers with value beyond standard personalized services. This is essential because Amazon already has branding and convenience as arsenal going into the insurance space.
Where Brokerages Stand in their Digital Journey
Like insurance providers, brokerages are seeing the importance of a customer centric approach, focused on digitalizing products that consumers are increasingly demanding. But brokerages are still lagging in this area, with well under half of brokerages developing technology that speaks directly to their customers’ needs and increases the efficiency of their operations.
Here is a sneak-peek of where brokerages are on their digital path:
Trufla’s truScore product helps brokerages assess their digital scores compared to their competitors, based on their digital reach and marketing and sales aptitude.
Digital Reach (DR)
The Digital Reach score shows a variety of metrics, including website findability, accessibility and performance, and reflects a brokerages’ ability to attract online traffic and the overall strength of its digital properties.
- 32% of brokerages scored 30 or lower on DR
- 62% scored between 31 and 60 on DR
- 6% scored between 61 and 82 (highest score) on DR
Marketing and Sales Aptitude (MSA)
The Marketing and Sales Aptitude provides a score on digital marketing capabilities, operations and sales processes.
- 91% of brokerages scored 25 or lower on MSA
- 8% scored between 26 and 50 on MSA
- 1% scored between 51 and 67 (highest score) on MSA
Where to Go from Here
If you are lost on where to begin your digital path, you are not alone.
The above data speaks for itself: A low percentage of brokerages received a high score on their scorecard (digital reach and marketing and sales aptitude). This means most brokerages must improve operational efficiencies and do more to meet customers’ needs to compete in the digital insurance market.
To find out how to improve your brokerage’s efficiency and compete effectively in the insurance space, contact us today.