By Rolfe Winkler
Google Inc. is taking steps to move into auto insurance sales in
several U.S. states, possibly using a new a comparison-shopping
site where visitors would be able to select auto policies
underwritten by others.
A business called Google Compare Auto Insurance Services
obtained licenses to sell insurance in 26 states, Forrester
Research principal analyst Ellen Carney said on Wednesday. Google
Compare is authorized to sell auto policies on behalf of six
insurers, Ms. Carney said.
A Google program manager was authorized to sell insurance
through Google Compare a year ago and through San Francisco-based
auto-insurance comparison site CoverHound Inc. last month,
according to the California Department of Insurance.
Google also is working with Comparenow.com, a unit of U.K. auto
insurer Admiral Group PLC, according to a person familiar with the
matter. Comparenow has relationships with 31 insurance carriers and
operates in 48 states and Washington, D.C., the person said.
Auto insurance sales are rapidly moving online, and Google could
accelerate the trend. Berkshire Hathaway Inc.'s Geico unit has
become one of the biggest underwriters in recent years by focusing
on Internet-based sales. Allstate Insurance Co. added direct online
sales when it bought Esurance Insurance Services in 2011. Insurers
that sell online can have lower costs than those selling through
individual agents.
Google provides auto- and travel-insurance quotes in the U.K.
and its latest moves point the search giant toward offering similar
services in the U.S. Google currently provides its own
product-search tools on the Google Shopping website, and offers an
array of flight- and hotel-booking tools.
A spokeswoman for the Mountain View, Calif., company said: "We
can't comment on speculation. Don't fault us, though; we enjoy your
coverage."
Greg Isaacs, president of Insurance Solutions at CoverHound,
confirmed that Google Regulator Operations Program Manager Meredith
Stechbart is authorized to write polices on behalf of his
company.
Offering insurance policies directly potentially is risky
because online travel insurance middlemen are buyers of Google
online advertisements. If it were to act as a middleman, Google
could save its users time online and bring in revenue through
insurance commissions.
"Google wants to do live quotes," said CoverHound's Mr. Isaacs.
Other online insurance sites take a user's information and pass it
to insurance carriers that follow up directly or provide estimates
of how much other carriers would charge.
If Google were to act as an agent representing insurance
carriers, Forrester's Ms. Carney said Google could presumably write
policies on behalf of carriers and keep a commission, as other
agents do.
Ms. Carney said Google has been working on the insurance
offering for more than two years. In Idaho, for instance, Google
has been licensed to sell insurance since August 2013.
Ms. Carney said Google may face resistance from insurance
companies that are reluctant to share information they believe
could later help Google compete with them.
Google has faced similar challenges with its online shopping
business. Google has spoken to retailers about the prospect of
adding a "buy" button so that consumers could buy products direct
from Google pages. But some retailers have pushed back, fearing
they would end up in brutal competition with one another on a
Google page they don't control.
Google also may hit resistance from regulators. The European
Commission's Competition Commissioner is looking at Google's push
into comparison shopping, local search and other areas as part of a
long-running investigation of Google's search practices. The London
Telegraph reported last May that the U.K.'s Financial Conduct
Authority has looked into complaints that Google's car-insurance
site in that country is unfairly squeezing out rivals.
The mobile revolution is putting more pressure on Google to
build up "vertical" search engines for specific categories, since
smartphone users are being trained, for instance, to go direct to
Amazon's app to buy products, or Expedia's app to book a flight or
a hotel room. If Google doesn't provide more efficient services
that cater to particular types of searches, it risks being cut out
itself.
Lisa Fleisher and Leslie Scism contributed to this article.
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