Talk of Amazon move into comparison sites hits potential rivals

Shares in Moneysupermarket.com and Gocompare.com fell yesterday amid fears that Amazon is laying the groundwork for its own insurance comparison website.

The online retail giant is reported to have held talks with a number of insurance executives over whether companies would be willing to contribute products to a prospective comparison site of its own.

While the type of insurance to be sold is not clear, home and motor insurance are popular on existing websites in the UK.

Amazon currently offers warranty extensions in Europe in partnership with The Warranty Group, as well as Amazon-branded credit cards in the UK and Germany. It reportedly posted job adverts for a new insurance business in Europe last year.

The news knocked stocks of potential rivals with shares in Moneysupermarket.com closing down by 5.2 per cent at 283.7p. Gocompare.com fell as much as 10 per cent at the start of trading but ended the session flat at 114p.

Amazon said it would not comment on rumours or speculation.

Russ Mould, investment director at AJ Bell, commented: “Expanding into financial services may seem a strange move for a retailer, yet it makes sense when you consider Amazon’s incredible reach and engagement with such a wide range of consumers.

“Home, travel and car insurance are already highly competitive markets from both an underwriting perspective and the number of price comparison sites. That won’t bother Amazon as its muscle power and wide reach could give it a fighting chance of making a big success from facilitating the sale of third-party insurance policies.

“Other industries linked with a potential move by Amazon include pharmaceuticals and business supplies distribution. And it has already made waves with food delivery and logistics.”

Amazon already runs Amazon Fresh, its nascent delivery business, and last year splashed out more than £10 billion to acquire supermarket chain Whole Foods.

It was reported last year that Amazon was weighing up plans for a corporate partnership that could see it begin selling cars to UK consumers on its website after whetting its appetite in European markets including France and Italy.

Mould added: “So what’s next? Can Amazon become an estate agent?

“Perhaps a more logical move would be to extend into the travel sector, offering discounted holidays, cruises and car rental.” 0 Amazon is reported to have held talks over whether firms would be willing to contribute products to a prospective comparison site