Google Inc. may be taking steps toward online auto insurance sales in the United States.
A company called Google Compare Auto Insurance Services is licensed to sell insurance in 26 states, said Forrester Research principle analyst Ellen Carney, who expects the California pilot for the new service to launch in the first quarter of 2015.
Industry experts say Google has been exploring online searches geared toward specific markets or industries, the Wall Street Journal reported.
In the auto insurance sales area, the Mountain View, Calif.-based company has been working on offerings for more than two years, Carney said. For instance, the company has been licensed to sell insurance in Idaho since 2013. Additionally, a Google program manager was authorized to sell insurance through CoverHound Inc. – an auto-insurance comparison site based in San Francisco – a month ago, and through Google Compare one year ago, according to the California Department of Insurance.
The company is also working with Compare.com, a subsidiary of UK auto insurer Admiral Group PLC, according to the Journal. Comparenow operates in 48 states and Washington DC and is affiliated with 31 insurance carriers.
Among other companies Google is working with include Dairyland and MetLife, Carney said.
Insurance companies selling online can have lower costs compared to those that sell through agents. If Google plays the role as a middleman in this industry, it could profit through insurance commissions.
Carney said the company could likely create policies on behalf of carriers and earn a commission the same way agents do.
With auto insurance sales swiftly moving online, Google could propel the trend forward faster. Geico, for example, has focused on Internet sales; as a result, it has become one of the biggest underwriters in recent years.
But Google may face challenges, as some insurance companies could be hesitant to provide information they think the Internet giant could use to compete with them in the future, Carney said.
The company has already been hit with resistance from retailers in regard to adding a “buy” button that would allow consumers to purchase merchandise directly from Google pages. Some say they fear doing so would result in brutal competition against each other on a Google page beyond their control, according to the Journal.
Google already offers auto and travel insurance quotes in the UK, but it could encounter opposition from regulators.
Its search practices are undergoing scrutiny from the European Commission’s Competition Commissioner, particularly its push into local search and comparison shopping, among other areas.
In May last year, the London Telegraph reported that the UK’s Financial Conduct Authority was considering complaints that a Google auto insurance site in that country is unfairly pushing out competitors.
A Google spokeswoman said the company could not comment on speculation regarding a move to sell auto insurance online.
(With reports from Reuters and The Wall Street Journal)
(www.asianjournal.com)
(LA Weekend January 10-13, 2015 Sec. D pg.2)
