Amazon is leading the $12m investment in Indian insurtech Acko according to Techcrunch. The direct insurer currently offers automobile insurance and ‘internet economy’ products. The latter includes e-commerce products as well as passenger coverage for Uber competitor Ola.
While the companies haven’t yet finalized products, the initial joint project is likely to be around gadget protection for Amazon sales in India.
Last year Amazon UK launched Amazon Protect which covers gadget and white goods purchases. The insurance is in partnership with The Warranty Group and covers theft as well as damage. Before it became Dixons Carphone, for years, Dixons was the leading electronics retailer in the UK. They were notorious for making a significant proportion of their profits from warranties.
Chinese insurer Zhong An is probably the largest e-commerce insurer in the world by volume. It’s also a major blockchain player. They provide e-commerce micro insurance, for example, to make sure your delivery arrives and you can return it.
They distribute the coverage by partnering with the significant e-commerce players. China’s retail e-commerce market of $1.2 trillion is roughly three times the size of the US market.
Amazon health JV
At last week’s Blockchain for Insurance Summit, a member of the audience commented that Amazon is one of the drivers that makes C-level executives more proactive in insurance.
At the end of January Amazon, Berkshire Hathaway, and JP Morgan Chase announced a partnership to cut health care costs and improve employee satisfaction. The combined companies employ 1.1 million people. The new company will provide technology solutions for US employees. However, the announcement said this is the ‘initial focus’.
The combination of a substantial insurer and extensive distribution sent ripples through the healthcare industry. The day of the January announcement marked the high points for several healthcare stocks. Since then Aetna is down 8% and Cigna 22%. UnitedHealth was down as much as 8% shortly after the announcement but has since recovered.
“The healthcare system is complex, and we enter into this challenge open-eyed about the degree of difficulty,” said Jeff Bezos, Amazon founder and CEO. “Hard as it might be, reducing healthcare’s burden on the economy while improving outcomes for employees and their families would be worth the effort.”
“The ballooning costs of healthcare act as a hungry tapeworm on the American economy. Our group does not come to this problem with answers. But we also do not accept it as inevitable.” said Berkshire Hathaway Chairman and CEO, Warren Buffett.