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Bancassurance - History, Evolution & Distribution Model
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Bancassurance - History, Evolution & Distribution Model

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Bancassurance - History, Evolution, Different types of Distribtution Model

Bancassurance - History, Evolution, Different types of Distribtution Model

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  • 1. AGENDA  Bancassurance – History  Bancassurance – Evolution  Bancassurance – A Win Win Situation  Bancassurance – Distribution Models  Bancassurance – Distribution Channel 1
  • 2. Bancassurance - History  Originated in France in 1980s  Spread rapidly across Europe  Introduced in India in 1999  Opening up of insurance industry  20 new companies 2
  • 3. Bancassurance - Evolution  Pressures on Banking Sector:  Customer retention in the face of competition  Staff retention and motivation  Universal Banking- approach to provide all financial product under one roof ; a broader relationship approach  Optimum utilisation of infrastructure and resources- maximise revenue 3
  • 4. Bancassurance - Evolution  Pressures on Insurance Sector:  Channel diversification from traditional direct sale  Access to a high quality customer base  Achieve the geographical reach within minimum time and cost  Ensure higher probability of success in the sales process 4
  • 5. Bancassurance – A Win Win Situation Solution: Insurance + Banking= Bancassurance 5
  • 6. Bancassurance – A Win Win Situation  The provision of insurance and banking products and services through a common distribution channel or to a common client base. 6
  • 7. Bancassurance – A Win Win Situation Bank Insurance Company  Customer retention  Revenue and channel diversification Satisfaction of more financial  Quality customer access needs under the same roof  Revenue diversification  Quicker geographical reach  More profitable resource  Creation of brand equity utilisation  Enriched work environment Leverage service synergies with Bank  Establish sales orientated culture  Establish a low cost acquisition channel 7
  • 8. Bancassurance - Distribution Model  Integrative / Generalist Model  Specialist Model  Financial Planning Model 8
  • 9. Bancassurance - Distribution Model  Integrative / Generalist Model  Product distribution through existing bank channel  Bankers themselves sells the product to customer  Process managed by banks and insurer act as only product/service provider e.g. Telemarketing, direct mail 9
  • 10. Bancassurance - Distribution Model  Specialist Model  Distributes insurance product through generally employees or representatives of the insurance company  Bankers help to identify the prospects who further contacted by insurance professionals  Requires less training and higher compensation to support the referral process  It lengthens the process of sale 10
  • 11. Bancassurance - Distribution Model  Financial Planning Model  Insurer employs sales force and deploys them at bank branches  Quick to implement as compare to other models  Bank as introducer, insurer sales force as converters  Offers each customer and prospect a full financial planning package addressing all of the individual's financial concerns 11
  • 12. Bancassurance - Distribution channels  Career Agents  Special Advisers  Salaried Agents  Bank Employees / Platform Banking  Corporate Agencies and Brokerage Firms  Direct Response  Internet  e-Brokerage  Outside Lead Generating Techniques 12
  • 13. Product- Sales approach High value Low Value Customer type Low volume High Volume High • Private Banking Full Service • Investment advice • Estate Planning • Portfolio management Distribution- Value Add including Full advice insurance planning (Financial • Investment advice Advisor) • Needs based selling • Ongoing relationship management • Customised Limited advice insurance plans (Life agent) • Income protection • Savings No advice • Segment specific • Segment specific • Segment • Segment features features specific features specific (direct) Low features Customised Product Complexity Commodity 13
  • 14. SWOT Analysis  Strengths  Vast untapped market  Huge pool of skilled professionals 14
  • 15. Contd….  Weakness  Lack of networking among bank branches  Saving Ability of Middle Class 15
  • 16. Contd….  Opportunities  Data mining Banks have a huge customer database which has to be properly leveraged. Target segments should be identified and tapped.  Wide distribution networks of banks  Exploit the corporate customers and tie - up for insurance of the employees of corporate clients. 16
  • 17. Contd….  Threats  Human Resource Challenges  Non-response from the target groups can also pose a challenge. 17
  • 18. THANK YOU 18