online retailer
online retailer

Amazon’s Insurance Business Is Closing After 2 Years

Amazon has closed its UK insurance business after 2 years after its launch. Their refocus is aimed at core businesses like e-commerce, cloud computing, and advertising.

Amazon’s insurance venture offered a range of products, including home, car, and travel insurance, partnering with insurers such as Ageas, Co-op, and LV.

However, industry experts had anticipated the closure, drawing parallels with the struggles of other large brands entering the insurance space. Ranald Mitchell, director at Charwin Private Clients, noted similarities with Google’s unsuccessful foray into insurance with the Google Comparison project.

 

Competitive Challenges and Market Realities

 

Industry insiders emphasise the difficulty of breaking into new markets, pointing out that while Amazon’s brand excels in online shopping, it lacked weight in the insurance sector.

Scott Gallacher, director at Rowley Turton, stressed that the closure highlights the challenges of entering unfamiliar territory. While acknowledging that reduced choice is generally bad news for consumers, experts suggest that Amazon might have faced issues such as thin profit margins, low awareness of its insurance services, or discomfort with UK financial regulations.

Similar struggles have been witnessed with other major brands like Tesco and Sainsbury, which entered financial services but eventually scaled back and closed down those operations.

Stephen Perkins, managing director at Yellow Brick Mortgages, speculates that Amazon might have found the profit margins in insurance less favorable compared to its core business.

 

Insights into Amazon’s Insurance Industry

 

Despite the setback, Amazon continues to have a role in the insurance space, particularly in supporting small and medium-sized enterprises (SMEs) on its Marketplace platform.
 

 
The company provides specialist online retailer insurance for more than 85,000 SMEs selling on Amazon Marketplace in the UK. This coverage includes public and product liability, stock and delivery cover, catering to the unique needs of online retailers.

For Amazon Marketplace sellers using the

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