Google’s foray into insurance officially began yesterday, as Californians gained access to Google Compare for auto insurance.
The feature, which is expected to expand to several more states in the coming months, allows shoppers to compare auto quotes from the 14 carriers that are participating in the site, including
MetLife,
Mercury Insurance and Safeco. The policies can then be purchased online or through an agent.
“Whether you’re a national insurance provider or one local to California, people searching for car insurance on their phone or computer can find you along with an apples-to-apples comparison of other providers all in as little as five minutes,” Google said in a news release.
The site has been trumpeted as yet another online channel poised to disrupt the independent agent sector: in an interview with the New York Times, Forrester Research insurance analyst Ellen Carney suggested the 40,000 agencies in the US could “absolutely…shrink by a quarter.”
Those in the industry say not so fast, however.
“What Google is really doing is adding another online channel,” said Sean Allen, vice president of North American sales for Xchanging Insurance Services. “The fact that they’re not underwriting today makes them really just another agency, and the biggest hit will be to companies like Esurance and Progressive.”
Comparison sites may even be a help to agents. Andrew Rose, CEO of Compare.com, which allows users to solicit quotes from more than 40 insurers, believes the real threat to agents is in the advertising dollars expended by what he deems the “big four:”
GEICO,
Allstate,
State Farm and Progressive.
By allowing consumers to explore options from carriers that do not dominate the public consciousness, Rose says comparison sites give agents affiliated with those carriers a chance to earn commission through an online channel, provided the shopper chooses to purchase through an agent rather than online.
“If you’re the John Smith Agency on the corner of Somewhere, USA, you’re in real trouble. The personal relationship structure of the past is changing,” Rose said. “Our model is something that gives agents consideration where they wouldn’t have it otherwise.
“We have a shot in competing against GEICO and other big advertisers. You may have to sacrifice a bit of commission up front to get your skin in the game, but it will allow you to take the personal relationships you offer and put it out on the multi-product market.”
Google is so far licensed to sell insurance in 26 states.
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