The abrupt news that Google is shutting down its U.S. and UK insurance aggregators, Google Compare, within a month rocked an industry that has spent the better part of the year since its launch wondering what the technology behemoth's next move would be.
A sigh of relief that Google is gone might not be the right reaction, however, says Ellen Carney of Forrester, who has been studying the Google-insurance interaction for the past couple years. Google's ability to start and stop initiatives on a dime, returning with improvements after reflecting on what it's learned, are why the Silicon Valley company has grown into a legend.
Google is licensed to sell insurance in 49 states -- all except Rhode Island, Carney notes. She believes the company would only take on the effort to do so if it still saw insurance in its long-term plans. She noted that Keith Moore, CEO of online agency and Google partner Coverhound, told the Wall Street Journal that his understanding is that Google will retool and relaunch the site at some time in the future.
"You are going to have some insurance carriers who think the lesson is going to be 'we can fall back on what we did before,'" Carney says. "But the smart ones will understand that Google is tweaking their offering and coming back."
In fact, there are plenty of ways the company can keep its finger on the pulse pulse of insurance, says Matt Josefowicz of Novarica, who also cautioned insurers in a blog entry against thinking the company is going away for good.
“Google isn’t leaving insurance. They’ve decided that selling through aggregators isn’t the right play for them right now," says Josefowicz, who notes that Google can make more money per click on auto-insurance related terms through AdWords than it could on commissions from sales. "They continue to dominate in advertising, and their data-related capabilities like Google Maps are in wide use. They may have realized it’s a better business for them to sell supplies than take the field themselves.”
Consumers are interested in what Google has to offer: Forrester's North American Financial Services Online Benchmark Recontact Survey 2015, which surveyed 10,000 U.S. adults with insurance, found that while only 3% of respondents had used Google's site, a further 8% were interested but hadn't yet and 39% hadn't heard of it but were interested.
Carney says that in that light, Google's decision to pull the plug now and potentially re-tool indicates that it is playing by a different set or rules than the insurance industry has traditionally when it comes to testing new ideas -- or at least, modern implementations of tried-and-true successes.
"Frequent small failures, building an agile business, we’re in that world now," she says. "It may come back with an experience for consumers that’s actually more classic-agent like."
Whatever form Google returns to the industry in -- or if it does -- the impact of a technology giant's attention to the the industry has been profound. Insurers are more attentive to the digital consumer than ever before, and the pressure from Google forced carriers and agents to be more innovative from a technology perspective.
"Google had people thinking differently and taking action," Carney says. "If they don’t come back out, at least it made people think different and generated new ideas in insurance."
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