Amazon plans to start offering insurance to small and medium-size UK business customers, the technology giant's first foray into business insurance in the country, broker Superscript said on Monday.
Members of Amazon's Business Prime programme will be able to buy coverage from Superscript such as contents insurance, cyber insurance, and personal indemnity insurance, which a Superscript spokesperson said would be underwritten by "major UK insurers". They will be offered a discount of 20% to current rates to entice them.
More than 50% of customers are prepared to buy insurance from nontraditional players such as big tech or insurance technology (insurtech) firms, according to a recent survey of 12,000 people globally by consultants Capgemini.
"The [insurance] industry needs to bridge the divide between insurers and customers by providing a quick, smooth buying process that is customer-centric," Cameron Shearer, co-founder and CEO of Superscript, said in a statement.
Amazon's move into UK business insurance comes after US insurtech Next Insurance said in March it was offering coverage to US small businesses via Amazon Business Prime.
"As businesses come out of the pandemic and gradually resume normalcy, we want customers to have the best-in-class tools to run their business," Molly Dobson, country manager for Amazon Business UK & Ireland, said in the statement.
Financial institutions are worried that tech firms will take away their business, trading on the tech players' stronger brand names and ease of access to their products.
But industry sources said insurers or banks and tech firms are more likely to forge partnerships than compete directly, given the difficulties and expense for outsiders in entering the highly regulated finance sector.
Amazon also offers warranty insurance and "buy now, pay later" services in the UK.
(Reporting by Carolyn Cohn; editing by David Gregorio)