Behind this growth has been a strategic focus on asia, where it has established itself as one of the leading insurers through a hugely successful bancassurance model and a series of canny acquisitions and strong strategic partnerships. Bancassurance in asia apria annual conference, seoul 24 july 10. Bancassurance financial planning manager insurance specialist hkd 20,000 hkd 38,000. Profitability and growth hsbc insurance has achieved remarkable growth in recent years. However, only about 25% of that amount comes from standalone protection. Bancassurance partnership with citibank in 11 markets. Bancassurance s expansion is a key trend across the thai and malaysian life insurance markets, according to research from timetric s insurance intelligence center iic. Most developments in bancassurance up to the mid1990s took place in europe. The influence of bancassurance system on the quality of.
Bancassurance in the world of analytics, ai, automation. Deloitte chinas gfsi center of excellence coe recently released the deloitte bancassurance white paper, the path of domestic bancassurance development. Bancassurance is a tool which is beneficial to bank, customer and insurer at. Move beyond single premium investments with the appeal of single premium investment products fading, both for banks and their customers, the bancassurance product offering must be. Aia and citibank reached agreement on an exclusive. Bancassurance has been a successful model in the european countries contributing 35% of premium income in the european life insurance market. The glasssteagall act of 1933 prevented the banks of the usa from entering into alliance with different financial services providers, thereby putting a barrier on bancassurance. Bancassurance, the provision of insurance services by banks, is an established and growing channel. Insurers, banks win in bancassurance inquirer business. Banks in many marketsparticularly asiapacific and latin americahave been clearly focused. Bancassurance market share the share of bancassurance in new business sales has increased steadily over the last few years for life insurance source. Alliance bank is the latest lender to sign a longterm partnership in asia. Figure 15 areas of bancassurance regulations number of institutions. Bancassurance drives growth in thailand and malaysia.
The bancassurance dilemma institute of actuaries of india. For instance, in the case of bancassurance, which is more. Worldwide, insurers have been successfully leveraging bancassurance to gain a foothold in markets with low insurance penetration. We offer you the convenience of making insurance services available to you in our banking halls or by visiting your relationship manager. Bancassurance is a fastgrowing life insurance distribution channel in the philippines, which is an underpenetrated market compared to its southeast asian. Bankers and customers perspectives on bancassurance in punjab. Bancassurance has its own shortcomings but undoubtedly if implemented properly it may change the face of indian economy for its own good. The bancassurance dilemma institute of actuaries of. In this partnership, bank staff and tellers become the point of sale and point of contact for the customer. Digitization also appears to be driving much of bancassurances.
This paper attempts to explain the scope for bancassurance models and strategy as feasible source of fee based, noninterest income. Jun 30, 2008 ing is now a market leader in bancassurance sales in asia pacific as well as the second largest insurer and asset manager. In spain, for example one of the largest bancassurance markets in the world insurers derive approximately 80% of all life premiums from bancassurance. The term has its origins in france and involves distribution of insurance products through a banks branch network. Key factors influencing bancassurance successmainland. Bancassurance becomes the most popular insurance selling channel in mainland china. The influence of bancassurance system on the quality of the insurance services dan constantinescu ecological university of bucharest, romania abstract bancassurance system is one of the most dynamic channel of the distribution of insurance industry, although it appeared recently. Bancassurance strategies have enjoyed considerable success in europe for some time, where an estimated twothird of life insurance and pensions business is transacted by banks in the leading markets of spain, portugal and france. It out discusses the essential dynamics of how it works. In india, there are a number of reasons why bancassurance could play a natural. Nanditamishra associateprofessor,international managementinstitute,kolkata,west bengal,india abstract. If youre looking for a free download links of bancassurance in europe pdf, epub, docx and torrent then this site is not for you. Key driver of bancassurance elsewhere in asia has been the following.
Although the first asian transactions were entered into around 15. According to a recent sigma study, bancassurance is on the rise, particularly in emerging markets. Figure 2 overleaf provides a list of the cases considered. While bancassurance has developed into a tremendous success story in europe, it is a relatively new concept in australia and asia. Bancassurance primarily banks on the relationship the customer has developed over a period of time with the bank. It describes and debates the many positive value opportunities inherent in facilitating bancassurance. Table 1 compares the bancassurance in europe, asia, and india vijayakumar, 2009. India has the largest banking network on one hand and lower. The three levels of bancassurance integration in preparing this paper we considered the bancassurance position of the largest banks in the world and other relevant case examples. The path of domestic bancassurance development deloitte china.
In terms of penetration, the asia pacific market is bifurcated. Bancassurance drives growth in thailand and malaysia life. Provide all levels of sales support and build up solid relationship with mapped bank partners. In 2007, sales from bancassurance operations contributed to 28.
Private life insurers tend to be more focused on bancassurance and hence generate a relatively higher proportion of their business through banks when compared to public sector. Insurers and banks formed about 50 bancassurance agreements in asiapacific in 2017 and 2018, in nepal, india, vietnam, pakistan and other markets. Concept, history and growth page 3 nationalization phase of indian banks was consisted of two stages. Bancassurance means selling insurance product through banks.
Net proceeds from asia to ageas group of eur 101 mio since 2001 in eur mio i 5 i capital invested vs. Chapter 1lines the strategic aspects of bancassurance as a development tool. Chapter1 revisiting the dimensions of bancassurance. Coming to india, bancassurance is a new buzzword in india. The global market for bancassurance international banker. Bancassurance commonly means selling insurance products under the same roof of a bank. It is also now well established in latin america and asia. Senior manager, business development, bancassurance aia. On the other hand, bancassurance as a share of the banks total customer base remains at a low level, often ranging from 1 to 4 percent.
Bancassurance, insurance, mutual funds, banking services, retail banking. In doing so, they seek to learn from the experiences of european bancassurers. In the asiapacific bancassurance market, metlife has the most relationships of any type with the 150 of the regions top banking groups but axa has the most joint ventures, and allianz and. Although the first asian transactions were entered into around 15 years ago, bancassurance is now the. It contributes over 65% of the life insurance premium income in spain, 60% in france, 50% in belgium and italy. The trend of bancassurance in indian life insurance sector for the past decade 200304 to 2014 is discussed.
The details of this paper is a product of the nonbank financial institutions, financial and private sector development. Figure 3 bancassurances market size in the asiapacific region. Bancassurance models differ between markets and are still evolving bancassurance the sale of retail insurance products to a commercial bank. Bancassurance is a tool which is beneficial to bank, customer and insurer at the same time. The exclusive longterm agreement with citibank is the widestreaching bancassurance distribution partnership ever in asia, building on aias unrivalled presence in the region and its strong and established bancassurance capabilities. Though bancassurance had roots in france in the 1980s, and spread across different parts of continental europe since, it has spread its wings in asia in particular, in india. Dec 16, 2015 bancassurance s expansion is a key trend across the thai and malaysian life insurance markets, according to research from timetric s insurance intelligence center iic. It also looks at the scope for bancassurance to go too far and cause problems through misselling. Bancassurance is a relationship between a bank and an insurance company that is aimed at offering insurance products or insurance benefits to the banks customers. In asia, however, bancassurance is gaining popularity, particularly in china, where restrictions have been eased. The different models drive profitability, product design and operational challenges. Aug 19, 2015 bancassurance is a fastgrowing life insurance distribution channel in the philippines, which is an underpenetrated market compared to its southeast asian neighbors, security bank president.
The research shows that social and cultural factors, as well as regulatory considerations and product complexity. Key points for the near future of bancassurance bancassurance is well settled around the world and still has a huge potential to grow in many countries and many business lines regulators and supervisors are right to develop protection of the interest 23 october 2014 20 of customers, which is their ultimate goal. A study of selected public and private sector banks revisiting the dimensions of bancassurance. Bancassurance products business protection standard. The launch of the asean economic community aec is also a major. The growth of bancassurance was phenomenal in initial years of opening. And pushing risk products through banks is a costeffective affair for an insurance company compared to the agent route, while, for banks, considering the falling interest rates, fee based income coming in at a minimum cost is more. A work in progress, by richard reed explains the differences between one european country eu and another on the success of bancassurance as a distribution channel for life insurance products. Senior manager, business development, bancassurance. This growth is attributable to strong bancassurance sales in key markets, rising incomes and increasing awareness of the need for and value of life products. This paper aims to investigate the scope of bancassurance in indian context. In contrast, bancassurance in asia has been a relatively recent phenomenon. In 1969, fourteen banks and in the year 1980, six more banks were nationalized. Lead sales team in supporting bancassurance department and bank partners to achieve business target.
The launch of the asean economic community aec is also a major boost. Ing is now a market leader in bancassurance sales in asiapacific as well as the second largest insurer and asset manager. Bancassurance, insurance, overview, companies, products. According to the statistical reported by china insurance regulatory commission, the premium income from bancassurance increased from rmb 127. In asia singapore, taiwan and hong kong are ahead in bancassurance, with india and china taking tentative steps towards it. Deregulation in china, india and other markets has lifted barriers to foreign ownership, creating new openings for multinational insurers. To thrive, bancassurance must adapt to this new environment. Financial deregulation facilitated the introduction of bancassurance notably with the penetration of foreign companies looking for establishing agreements with local banks.
Bancassurance bancassurance symbolises the convergence of banking and insurance. The influence of bancassurance system on the quality of the. Bank staff are advised and supported by the insurance company through wholesale product information, marketing campaigns. Oliver wyman believes five changes to the now standard model will help to revitalise bancassurance. Bancassurance to contribute to the growth and the stability that both life and nonlife insurance products can bring to developing countries.
Private life insurers tend to be more focused on bancassurance and hence generate a relatively higher proportion of their business through banks when compared to public. Bancassurance is the process of using a banks customer relationships to sell life and nonlife insurance products. Bancassurance, insurance, mutual funds, banking services, retail. However, banks and insurers in other parts of the world, e. Banks and insurance company come up in a partnership wherein the bank sells the tied insurance companys insurance products to its clients. The premium collected through bancassurance has gone up to rs. Looking forward to 2018, the iic forecasts both life markets in southeast asia will grow significantly driven by rising life expectancy and tax benefits. For insurers across the diverse markets of the asiapacific region, its a time. Though bancassurance had roots in france in the 1980s, and spread across different parts of continental europe since, it has spread its wings in asia. The path of domestic bancassurance development deloitte. Bancassurance free download as powerpoint presentation. Asia financial crisis of 1997 was a driving force in the banking industry and since 2000 it is very dominant. Bancassurance asia financial crisis of 1997 was a driving. In some developed countries it has had a dramatic impact on developing sales.