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Tech firms cutting out insurers to provide own employee benefits

Amazon is the latest to offer in-house insurance and health benefits

Technology companies are starting to cut out insurance firms and provide their own employee benefits schemes.

Amazon has become the latest big company to offer an in-house insurance and health benefit scheme.

Amazon Care will include virtual and actual care via apps, chat facilities, remote videos and follow-up visits. Starting out in Seattle, the scheme will likely be rolled out further if successful.

GlobalData, the data analytics and consulting firm, said offering in-house benefits makes sense for large corporations, which traditionally outsource these services to insurers.

However, it warned the strategy means employers will need to quickly learn what their workers want from health insurance in order to hold onto them in the competitive marketplace.

Ben Carey-Evans, insurance analyst at GlobalData, said moving medical insurance services in-house provides companies with more control over what they offer employees, allowing them to tailor packages specifically to their workforce’s needs. “Tech companies such as Amazon – which often employ younger (or at least digitally savvy) employees – are ideally placed to design products that address the work-life balance,” he added. “By focusing on what their employees value most, the likes of Amazon will be able to attract and retain individuals in the competitive tech space. It should also allow them to reduce costs by cutting out the middle man.”