Amazon Insurance: How Independent Agents Can Stay Competitive

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  • Amazon is one of the world’s biggest companies. Annual revenue for the digital giant reached nearly $233 billion in 2018, reports Macrotrends — more than a 30-percent increase from 2017. Not only is it huge, it’s also growing at an extremely rapid rate.

    The world’s largest online retailer seems to have a hand in nearly everything these days. It’s already disrupted everything from music streaming and TV to grocery delivery and meal prep, says journalist Champaign Williams. So, it should come as no surprise that Amazon now has its sights set on insurance.


    Amazon’s Plans in India

    Amazon plans to sell insurance in India, writes Nishant Sharma at Bloomberg Quint. Operating as Amazon India, it will start by offering life, health and general insurance and hopes to soon become the first all-digital insurance carrier in India. If successful, Amazon would likely branch into other areas of insurance in the future.

    With India’s insurance industry expected to reach $280 billion by 2020, adds Sharma, it’s easy to see why the Seattle-based corporation is so interested.

    Bloomberg News editor Sam Unsted notes that Amazon is considering creating an insurance price comparison site in the UK. While no official plans have been put into action, it indicates that Amazon’s insurance initiatives aren’t limited to India and could become global in the very near future.


    Emerging in the US Market

    This begs the question: Is Amazon planning to tackle the US insurance market?

    The answer is yes. In fact, Amazon has already partnered with American insurance provider The Travelers Companies, Inc., Insurance Business news editor Bethan Moorcraft reports. Under this partnership, Travelers is offering smart home kits to protect homeowners against fire, water and security threats.

    While Amazon hasn’t launched its own line of insurance in the US yet, this partnership shows that they could certainly be heading in that direction. It won’t be an official insurance carrier or direct agency any time soon, but it puts some pressure on the insurance industry, explains business writer Alicja Grzadkowska.

    amazon insurance

    What Independent Agents Can Do Now

    This likely doesn’t sit well with many independent agents. Many see news like this and worry about their job prospects. What do you do if Amazon is looking to take your job?

    Don’t panic. This push from Amazon isn’t the first time the insurance industry has faced disruptions. There were major concerns that the advent of the internet would disrupt insurance lead distribution, Laird Rixford, CEO of Insurance Technologies Corporations, tells Gradkowska. But that’s not what ultimately happened. If anything, the internet has helped independent agents gain more exposure and improve lead generation.

    Amazon’s attempt to move into the insurance realm just means that agents need to be aware of the current climate and take measures to stay ahead of the curve.


    The 3 Key Differentiators Independent Agents Have

    As with any industry, a big part of succeeding at selling insurance is distinguishing yourself from the competition. Develop a unique value proposition, and it will become the primary reason why customers should buy from you, conversion optimization expert Peep Laja writes.

    Here are some key differentiators that will not only put you in a position to thrive but achieve sustained success.


    Focus on Building Relationships

    One of the biggest things that independent agents have going for them is their relationship with customers. Rixford points out that the personal, one-on-one interactions with customers are what build trust and rapport. This is how you get long-term customers.

    The encouraging thing is that no matter how big technology becomes, many people still value their relationships with independent agents.

    “About half of insurance shoppers obtain a quote through an insurer website before purchasing a policy, according to J.D. Power’s 2016 U.S. Insurance Shopping Study,” writes growth strategy consultant Nahu Ghebremichael. “Despite this, only 25% actually buy their policy online, according to the report, and half complete the sale through direct contact with an agent.”

    As long as your customer relationships are your priority, you should be in good shape, regardless of what Amazon does. That’s why it’s so important to go the extra mile and act as a trusted advisor.


    Provide Outstanding Customer Service

    In the same vein, go out of your way to provide excellent service, says Becky Schroeder, senior VP of sales and marketing at Insurance Technologies Corporation. Be sure to respond quickly to inquiries and follow through whenever you say you’ll do something.

    Customer support professional Alexa Lemzy agrees, adding that it’s also vital to pay attention to changes in your customers’ lives. Gather as much information as you can so that you know about major events like your customers getting married or having a child go off to college. This enables you to go beyond the surface level and offer the right coverage at the right time. For instance, if one of your customer’s kids is turning 16 and getting their license, you might present them with information on obtaining first-time auto coverage and make policy recommendations based on their needs.

    This simplifies your customers’ lives, and it creates upselling and cross-selling opportunities.


    Be Prominent in Search Engines

    Schroeder reminds independent agents of the importance of their agency appearing in local search results. Whenever prospects search for a keyword like “homeowners insurance [your city],” you want your company to be one of the first sites to pop up.

    Investing in search engine optimization and optimizing your website for mobile users is how you accomplish that.

    amazon insurance

    Help Customers Navigate an Evolving Marketplace

    The insurance industry has changed a lot in recent years, and not all customers are up to speed with what’s going on. Many are unsure which resources they should use to find insurance, how to compare different policies and how to find the optimal coverage. So, you’ll want to be on the lookout for new ways to help them navigate an evolving marketplace.

    This largely boils down to embracing technology and providing your customers with the tools needed to streamline the insurance shopping experience, explains customer service consultant Micah Solomon.

    For his Forbes article, Solomon spoke to Larry Keefe, CEO of insurance company Starkweather & Shepley — a company that’s been around since 1879. Keefe told Solomon that no one would confuse his firm with being high-tech. However, it has been diligent about staying on top of technology that supports customers directly.

    “Even though we were founded as a firm in the early part of another century, we understand that insurance clients [today] want the same level of technical support that they receive in more tech-savvy industries,” Keefe said. “Your customers are the same customers who buy from Amazon, who order their latte on their mobile from Starbucks … we have to keep up, in speed and convenience.”

    Digital tools that make buying insurance more convenient are a great way to offer that speed and convenience, says marketer Nicholas Chuvalas. A portion of tech-savvy customers don’t always want to deal with an agent directly unless they have questions or problems. If it’s a straightforward transaction, they’d rather log into a website, get a quote online and renew their coverage digitally.

    It’s also nice to have multiple communication channels, he adds. Rather than being limited to just phone and email, many customers would like other communication options like text, social media and chatbots. This ensures they can get in touch with you in a way that’s convenient for them. It also helps you keep up with tech-centric companies like Amazon.

    You may even want to consider creating your own mobile app to target those customers using mobile devices rather than desktops. Allowing mobile e-signatures is one specific feature to include because it takes the hassle out of signing documents.

    Images by: Daniele Levis Pelusi, rmarmion/©, sheeler/©