Insurance brokers selling personal lines of property/casualty insurance collected over $50 billion in commissions in 2013. Now Google and WalMart are among the companies that want a piece of the action.
The property/casualty insurance industry is a huge pot of business opportunity. In 2013, premiums for auto, home and commercial insurance totaled $481 billion, of which $50 billion went for agent commissions. In my mind, that $50 billion could be reduced to around zero. After all, if I buy a car, I know that I need to buy insurance. Why should 10% of my insurance premium go to pay someone who sells me that policy? Why not subtract that 10% from my insurance premium and let me buy the policy online after comparing vendors based on price and service quality? It appears as though Google is trying to come to the rescue for consumers. Google operates a search engine for auto insurance prices called Google Compare. According to the Times, Google Compare “has been operating in Britain for two years, and Google is working on something similar for the U.S.” Google can sell insurance in about half of the U.S. and has formed a partnership with an insurance comparison site. According to Forrester Research analyst Ellen Carney, Google is licensed to sell insurance “in about half of the states.” Moreover, Google partnered with Comparenow, an American auto insurance comparison site owned by Britain’s Admiral Group, a car insurance company that has operated a European price-comparison site for more than 10 years. Through the joint venture, Google will access insurers in Comparenow’s network, the Times reports.