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Google, Amazon, Walmart… Who Is Next To Enter The Insurance Market?


Nowadays nontraditional companies such as Google, Amazon and Walmart are entering the insurance intermediary market to capitalize on their brand image, large capital and customer base. Their primary focus is on distribution of health, property and casualty insurance products. In line with this trend, these companies are also entering into partnerships, joint ventures and alliances with other established insurance carriers to offer insurance products and services to their customers. For instance, Walmart and Autoinsurance.com formed an alliance in 2014. Similarly, Magma Fincorp and HDI-Gerling came together to form a joint venture in 2015. These collaborations have enabled new entrants to acquire market knowledge and understand the industry dynamics.

INSURANCE BROKERS AND AGENTS MARKET TO REACH $475 BILLION BY 2020 ACCORDING TO THE BUSINESS RESEARCH COMPANY.

The Business Research Company expects the insurance brokers and agents market to grow to $475 billion in 2020. The Americas was the largest geographic market in the Insurance Brokers and Agents market in 2016, accounting for around one third of the global market. The Americas was the largest market because of high broker presence, strong distribution network and wide range of feed based services.

The figure below shows the year-on-year growth of the global Insurance Brokers and Agents market during 2016 – 2020.

According to The Business Research Company’s Financial Consultant, Girish Kavali, another trend in the market is that bancassurance is gaining prominence within the insurance intermediation industry. This distribution channel is being used by banks to cross-sell its products and services and generate additional revenue. Bancassurance also benefits the insurance company by providing an exposure to a wider customer base via the bank’s distribution network of agents and branches. The adoption of more diversified and enhanced products offered by banks is expected to drive the bancassurance market at a CAGR of nearly 8% to 2019.

The insurance brokers and agents market is fragmented, with a number of large, global players, among which Marsh & McLennan Cos. Inc. was the largest competitor with revenues of $6.9 billion in the financial year 2015.

The insurance brokers and agents market is mainly engaged in acting as intermediaries (i.e., agents, brokers) in selling annuities and insurance policies. They represent consumers in insurance transactions. Insurance brokers and agents can be contracted with single or multiple insurance companies as they try to meet different client needs with suitable insurance products. This market excludes the direct selling of insurance products by insurance companies.

The entities usually charge a certain proportion of the insurance premium as a commission for their services. Such commission is usually deducted or collected from insurance companies. However, some entities charge and collect fees from customers as well. Commissions are generally fixed by respective insurance companies but are subject to country specific regulation and statutory laws.

The insurance brokers and agents market is categorized based on business model. The insurance brokers and agents market is broadly classified into the following categories –

Agencies are entities or individuals acting as intermediaries in selling annuities and insurance policies. This includes both companies and independent intermediaries who are tagged to particular insurance carriers. However, some agents sell policies from multiple insurance carriers. These entities charge a certain proportion of premium from insurance companies as commission for their intermediation services.

Brokers are engaged as intermediaries in selling annuities and insurance policies. These companies offer wide range of insurance products from various insurance carriers. These entities charge premium or commission from insurance companies as well as from customers.

Bancassurance refers to selling insurance products and services through banking institutions. This distribution channel includes joint ventures between banks and insurance companies or banks selling insurance policies of companies by charging transaction based commission. These entities charge commission from insurance companies.

Other Intermediaries comprise all other establishments involved in selling insurance products and services. This includes channels such as online retailing, financial institutions (excluding banks) and third party sites. This channel excludes direct selling by the insurance companies themselves of their own products.

Insurance Brokers and Agents Global Market Briefing is a detailed report giving a unique insight into this market. The report is priced at $500 for an individual user. To use across your office the price is $1000 and $1350 if you wish to use across a multinational company.

About The Business Research Company

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The Business Research Company is a market research and intelligence company, which excels in company, market and consumer research.

It has research professionals at its offices in the UK, India and the US as well a network of trained researchers globally. It has specialist consultants in a wide range of industries including manufacturing, healthcare, chemicals and technology.

The Business Research Company's management has more than 20 years of varied business research experience. They have delivered hundreds of research projects to the senior management of some of the world's largest organizations.


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