Recent moves by Google indicate that the multinational company that built its success on a search engine may be poised to offer auto insurance.
According to Gizmodo – a design and technology blog that is part of the Gawker Media network – Google is set to launch a new car insurance shopping site.
Google has run an automotive insurance comparison site in the U.K. for a couple of years now, but now is showing signs that it is ready to deploy in the U.S. The New York Times reports that Google has recently formed a partnership CompareNow.com “which operates like the Kayak travel site only for auto insurance.”
Google is also now licensed to sell insurance in more than half of the states in the U.S.
A Google employee in San Francisco, Calif. recently became a licensed insurance agent, and analysts speculate it's to start buying insurance agencies “as a means of greasing its entry into the lucrative California market,” according to a Gizmodo blog post.
The moves suggest that Google is getting ready to offer tools in the U.S. for auto insurance comparison shopping, in much the same way it already does with hotel and flight reservations, according to CNET. Fees paid for referrals through the service could deliver Google a new revenue source in the face of the company's eroding search dominance, which slipped to 75.2 percent in December from 79.3 percent a year ago.
Insurance comparison is common in Europe, but in the U.S., the law states that the site that brings the quotes together must itself be licensed to sell the insurance to the customers.
According to Forrester Research analyst Ellen Carney, the acquisition of CoverHound in California “gets the Google insurance entity to market faster in the U.S. than they've been able to get on their own,” providing them a national full-service independent agency “with more insurers that have already signed on.”
CoverHound's experience in the industry “would give it clout,” and that Google’s delay in launching the service would be explained by the acquisition, added Carney.
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