The deal with CompareNow.com, which is similar to the Kayak travel comparison site but for auto insurance, gives Google access to about 30 insurers in CompareNow's network, including Dairyland, MetLife, Mercury, Permanent General Assurance, Viking Insurance of Wisconsin and Workmen's, according to an analyst at Forrester Research.

Not entirely new for Google

Google has run an auto insurance comparison site in the U.K. for two years, where such Web comparison portals are common.

In the U.S., the law regulates that any site that brings an insurance quote together must also be licensed to sell insurance. However, a Google employee in San Francisco recently became a licensed insurance agent, according to Forrester analyst Ellen Carney, who also pulled public filings to determine that Google is now licensed to do business in half of the states: Alaska, Arizona, Delaware, Florida, Idaho, Illinois, Indiana, Louisiana, Massachusetts, Minnesota, Missouri, New Hampshire, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, South Carolina, Tennessee, Texas, Washington, West Virginia, Wisconsin and Wyoming.

The site is expected to launch in California very shortly, followed by "likely launches in Illinois, Pennsylvania and Texas," Carney writes.

What to do?

Anderson says that the key to meeting the behemoth's challenges is to demonstrate your value, something that producers have been neglecting recently.

For too long, agents have been order-takers, he says. But now, especially given the imminent launch of Google Compare Auto Insurance Services Inc., agents have to learn how to reach out and tell a story. "And the story is, a Personal Auto Policy is not the same," he says. "A Geico policy or a Google policy, there are significant differences there. And agents have not been good at telling the story that insurance is not a commodity."

Indeed, that's something echoed by NU P&C columnist Chris Amrhein, who asked agents to state that as their New Year's Resolution. "It's time to embrace a simple reality: advertising is not truth-telling. Just because it's simpler, quicker, cheaper or has a cool name doesn't mean that it's attractive," he writes. 

One way to show value? Deliver solid proof to your clients of the clear advantages of working with you, especially during the claims process, where the independent agent can really shine over the latest online or big box insurance store, Amrhein says. 

Take a balanced approach to marketing–through online, content marketing and the telephone. "We say as agents that we have a relationship with people, but I'm not concerned that people think we do," Anderson says. "And that's a follow-up failure."

Anderson says that the Google executives in charge of this program appear to not have a background in insurance (Carney states that the three executives' LinkedIn profiles include roles of project manager, securities and corporate governance, and regulatory operations), and that this is both good and bad for independent agents. "The Google execs don't know what they can't do–but whereas I accept and understand state regulations, they may say 'Why not?' and challenge them."

An independent agent is not going to be able to compete with a Google search for auto insurance, as "an independent agent can't out-Google Google, but they can out-local Google," Anderson stresses. "Most agents have a local presence, which is where Google will have a much harder time."