I see this week that Amazon are in talks with JP Morgan to set up a new banking account in the USA, which is forecast to be the 3rd largest bank in the world within 5 years. Speculation concerning Amazon's move into to the FinTech and InsureTech world is nothing new, but to see big deals like this actually taking place really brings home the speed of change in our sector.
It was only back in January that Lemonade, the archetypal full-stack insurance start-up, made noises about Amazon poaching their staff, and within insurance circles the assumption has always been that Amazon would move into the emerging markets first, hence their rumoured investment in the Indian Insurtech start up, Acko. The interesting thing now is that in going for banking they are heading straight for the established US market, also targeting the younger demographic, which always holds the best customer data, and this should be scaring their competition.
Amazon know, better than anyone, that insurance is a knowledge based business, and a market where the winners will be those that are able to establish full control of their most important asset, data. Perhaps we should also be ready for these giants moving into our market and by taking full control of our data, prepare ourselves accordingly.
This could be the third partnership between Amazon and J.P. Morgan. In January, Amazon announced a partnership with the bank and Berkshire Hathaway to develop a not-for-profit healthcare venture to lower costs for its U.S.-based employees.