E-commerce giant Amazon’s recent announcement that it is starting life, health and general insurance products in India, may likely have ripples effects in New Zealand, says FintechNZ General Manager, James Brown.
“It’s certainly going to make everybody sit up and take notice,” said Brown, adding he expects it may cause large organisations within New Zealand’s insurance industry to examine their current processes.
“This decision by Amazon is a serious move by one of the biggest global tech firms and is an indication that they are going after large markets with an insurance licence application already in.”
Amazon’s Indian decision is expected to be worth $US280 billion by the year 2020.
“Competition and disruption is good,” he said. “I absolutely believe that over the next 6-12 months we’ll see some of these other big organisations come out [to New Zealand] to do something similar and I’m hopeful that some of the conversations that we’re having at the moment have a net result in them using and continuing to use New Zealand as a test bed.”
“Competition and disruption is good”
He expected it was only a matter of time before large tech firms moved into financial services, based on the data they hold and the reach that they have.
New Zealand already has many things in its favour that other jurisdictions do not, said Edwards, such as extremely good relationships with government also with the regulators, noting the FMA’s willingness to have discussions around new technology.
“Insurance has, in the past, been slower to react than the banking world however, it looks like it will need to get its running shoes on with this announcement,” he said.