The products will launch on India Amazon and can be purchased through Amazon Pay. Customers will be able to purchase policies in as little as 2 minutes, without having to complete any traditional paperwork. Additionally, it offers paperwork-free claims, 1-hour pickup, three-day servicing, and one-year repair warranty in select cities.
For the new venture, Amazon is expanding on its partnership with insurtech Acko. India-based Acko Technology is the parent company of Acko General Insurance, which offers direct-to-consumer auto insurance coverage as well as third-party insurance products, like ride protection. Acko already provides a health insurance product on Amazon’s behalf: They launched free COVID-19 health insurance for Amazon sellers in India in May, for example.
India has a large underserved auto insurance market ripe for disruption, and the increased interest in purchasing insurance from big tech firms can further accelerate adoption.
- India has low auto insurance penetration and high fintech adoption, making Amazon’s new venture a good fit for the market. Around 50% of Indian vehicles are uninsured, largely because incumbents’ insurance offerings are inaccessible due to their uncompetitive, flat prices and the fact that they’re mainly offline. The country also boasts the highest fintech adoption rate among digitally active consumers worldwide, per EY. Amazon’s insurance offering being available online could therefore make it more accessible since consumers are keen on trying digital financial services, but adoption will now depend on competitive pricing.
- Moreover, customers globally are increasingly willing to buy insurance from big tech companies. Just 17% of consumers were willing to do so in 2016, but that has since grown to 36% in 2020, per Capgemini. Of note, WhatsApp also recently expanded its financial services, including credit, insurance, and pensions, in India. But Amazon already has vast amounts of data from consumers due to its other products in India, which can help it appropriately underwrite risk, and it can use this data to offer personalized policies tailored to users’ individual needs.
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