Bancassurance    New Marketing Product  for  the Banks Dr. B.Krishnamurthy Selection Grade Lecturer & Head, Deptt. Of Comm...
Introduction <ul><li>Bancassurance is the convergence of Banking and Insurance </li></ul><ul><li>The term has its origin i...
Scope <ul><li>Banks tapping new sources of income </li></ul><ul><li>Finding ways to differentiate themselves from other ba...
Customers Aspirations <ul><li>Demanding fast, accurate and reliable services  </li></ul><ul><li>Adoption of technology is ...
Insurance sector   <ul><li>Setting up their own insurance companies  </li></ul><ul><li>Entered into memoranda of understan...
Electronics and Information Technology   <ul><li>Banking products and services are provided to consumers with complete eas...
Projection   <ul><li>Insurance business to be worth around $60 billion by 2010 projected by Associated Chamber of Commerce...
Bank’s Entry <ul><li>Banks entering the insurance sector on their own without partnering with insurance companies due to s...
IRDA <ul><li>To protect the interests of the policyholders to regulate, promote and ensure orderly growth of the insurance...
List of Registered  Life Insurers with the IRDA   <ul><li>Today we have 22 Life Insurers in India </li></ul><ul><li>23.10....
SBI Life Insurance Company Limited <ul><li>Joint venture between the State Bank of India and BNP Paribas Assurance registe...
State Bank of India   <ul><li>Largest banking franchise in India along with its 7 Associate Banks, with a  strength of ove...
Canara HSBC Oriental Bank of Commerce Life Insurance Company Limited:   <ul><li>Share Holdings </li></ul><ul><li>1. Canara...
ING Vysya Life Insurance Company Limited (ING Life   <ul><li>Started operations in India in September 2001 </li></ul><ul><...
Coporate Agents <ul><li>Corporate Agents are those companies who have the principal business other than insurance .   </li...
Micro-insurance   <ul><li>Micro-insurance, the term used to refer to insurance to the low-income people.  </li></ul><ul><l...
Tata AIG Life Insurance Company Limited <ul><li>Tata AIG Life is a joint venture company formed by the Tata Group and Amer...
Impact on Human Resources <ul><li>Information technology has resulted in improved efficiency,Iinnovative products and Effe...
Conclusion: <ul><li>Require the good aptitude of the existing workers.  </li></ul><ul><li>Continuously evolve newer techni...
Challenges  <ul><li>Competition, customer expectation, reduction of costs and enhancement of efficiency  </li></ul><ul><li...
<ul><li>Thank You </li></ul>
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Bancassurance

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Bancassurance is the convergence of Banking and Insurance. The term has its origin in France, involves distribution of insurance products through a bank's branch network. According to a recent sigma study, Bancassurance is on the rise worldwide It has a tremendous success story in Europe, but it is relatively new concept in Australia and Asia. In Asia, however, Bancassurance is gaining in popularity, where restrictions have been eased.

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Bancassurance

  1. 1. Bancassurance New Marketing Product for the Banks Dr. B.Krishnamurthy Selection Grade Lecturer & Head, Deptt. Of Commerce, R.T.E.S.College, Ranebennur.
  2. 2. Introduction <ul><li>Bancassurance is the convergence of Banking and Insurance </li></ul><ul><li>The term has its origin in France </li></ul><ul><li>Bancassurance gaining popularity in Asia, where restrictions have been eased </li></ul><ul><li>The proverbial goose laying golden eggs for public sector banks </li></ul>
  3. 3. Scope <ul><li>Banks tapping new sources of income </li></ul><ul><li>Finding ways to differentiate themselves from other banks and non-banks </li></ul><ul><li>The technology forces the banks to develop a strategy for online delivery system to broaden the customer relationship and to retain customers’ loyalty. </li></ul><ul><li>Greater competition for the banks as the technology pushes the delivery of services out of bank and </li></ul><ul><li>Focus shifts from cost reduction to maintain market position. </li></ul>
  4. 4. Customers Aspirations <ul><li>Demanding fast, accurate and reliable services </li></ul><ul><li>Adoption of technology is inevitable to respond </li></ul><ul><li>Need at all time and at competitive prices </li></ul><ul><li>Anywhere banking facilities offer access to banking services at a place and time convenience. </li></ul>
  5. 5. Insurance sector <ul><li>Setting up their own insurance companies </li></ul><ul><li>Entered into memoranda of understanding with banks to use their branches as outlets for marketing standard products. </li></ul><ul><li>State Bank of India, Vysya Bank and J&K Bank already has joint ventures in life insurance. Vijaya Bank and Punjab National Bank are in the midst of finalizing life and non-life ventures </li></ul>
  6. 6. Electronics and Information Technology <ul><li>Banking products and services are provided to consumers with complete ease and maximum efficiency. </li></ul><ul><li>Bank need not be limited by its physical establishments </li></ul><ul><li>Can have on-line presence to reach out the more customers </li></ul><ul><li>Compete not only with local banks but also with foreign banks </li></ul>
  7. 7. Projection <ul><li>Insurance business to be worth around $60 billion by 2010 projected by Associated Chamber of Commerce and Industry. </li></ul>
  8. 8. Bank’s Entry <ul><li>Banks entering the insurance sector on their own without partnering with insurance companies due to several reasons </li></ul><ul><li>Get better dividends than the commission </li></ul><ul><li>Diversify from the regular banking activity that they are involved </li></ul>
  9. 9. IRDA <ul><li>To protect the interests of the policyholders to regulate, promote and ensure orderly growth of the insurance industry and for matters connected therewith or incidental thereto </li></ul><ul><li>Insurance Regulatory and Development Authority came into effect from 1-04-2000 </li></ul><ul><li>Today we have 22 insurers </li></ul>
  10. 10. List of Registered Life Insurers with the IRDA <ul><li>Today we have 22 Life Insurers in India </li></ul><ul><li>23.10.2000 HDFC Standard Life Insurance Company Ltd. </li></ul><ul><li>15.11.2000 Max New York Life Insurance Co. Ltd. </li></ul><ul><li>24.11.2000 ICICI Prudential Life Insurance Company Ltd. </li></ul><ul><li>08.05.2008 Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd. </li></ul><ul><li>27.06.2008 Aegon Religare Life Insurance Company Ltd. </li></ul><ul><li>27.06.2008 DLF Pramerica Life Insurance Company Ltd. </li></ul><ul><li>Star Union Dai-ichi Life Insurance Co. Ltd., </li></ul>
  11. 11. SBI Life Insurance Company Limited <ul><li>Joint venture between the State Bank of India and BNP Paribas Assurance registered with IRDA on 30.03.2001 </li></ul><ul><li>State Bank of India --- 74% BNP Paribas Assurance --- 26%. </li></ul>
  12. 12. State Bank of India <ul><li>Largest banking franchise in India along with its 7 Associate Banks, with a strength of over 14,500 branches across the country, arguably the largest in the world. BNP Paribas Assurance is the life and property & casualty insurance unit </li></ul><ul><li>Oldest foreign banks with a presence in India dating back to 1860. </li></ul>
  13. 13. Canara HSBC Oriental Bank of Commerce Life Insurance Company Limited: <ul><li>Share Holdings </li></ul><ul><li>1. Canara Bank - 51% </li></ul><ul><li>2. HSBC Insurance </li></ul><ul><li>(Asia Pacific ) Holdings Ltd - 26% </li></ul><ul><li>3. Oriental Bank of Commerce - 23% </li></ul><ul><li>Paid up capital of INR 325 Crores. </li></ul><ul><li>Commenced its business on 6th of June, 2008 </li></ul>
  14. 14. ING Vysya Life Insurance Company Limited (ING Life <ul><li>Started operations in India in September 2001 </li></ul><ul><li>ING Life has a pan India presence in 234 cities, with over 367 sales teams </li></ul>
  15. 15. Coporate Agents <ul><li>Corporate Agents are those companies who have the principal business other than insurance . </li></ul><ul><li>Banks undertaking insurance activity to increase their income & attract the new customers with the existing human resource and the use of communication and information technology </li></ul><ul><li>The share of corporate agents which was 8.42 per cent in 2006-07 has increased to 12.33 per cent in 2007-08. </li></ul>
  16. 16. Micro-insurance <ul><li>Micro-insurance, the term used to refer to insurance to the low-income people. </li></ul><ul><li>It is mandatory for all formal insurance companies to extend their activities to rural and well-identified social sector in the country (IRDA 2000). </li></ul><ul><li>Tata AIG Life - First insurance company to launch Micro-Insurance Scheme. </li></ul>
  17. 17. Tata AIG Life Insurance Company Limited <ul><li>Tata AIG Life is a joint venture company formed by the Tata Group and American International Group, Inc. (AIG). </li></ul><ul><li>The Tata Group holds 74 per cent stake and AIG holding 26 per cent. </li></ul><ul><li>Providing Insurance solutions to both Individuals and corporates </li></ul><ul><li>Operation from April 1, 2001. </li></ul>
  18. 18. Impact on Human Resources <ul><li>Information technology has resulted in improved efficiency,Iinnovative products and Effective delivery systems for the banks. </li></ul><ul><li>However, the employees have the fear of job insecurity due to induction of computer skilled employees and </li></ul><ul><li>Reduction in jobs </li></ul>
  19. 19. Conclusion: <ul><li>Require the good aptitude of the existing workers. </li></ul><ul><li>Continuously evolve newer techniques for making business transactions </li></ul><ul><li>better, faster and more efficient </li></ul>
  20. 20. Challenges <ul><li>Competition, customer expectation, reduction of costs and enhancement of efficiency </li></ul><ul><li>Need training and retraining of staffs and retention of highly specialized to become the vital factors for banks. </li></ul>
  21. 21. <ul><li>Thank You </li></ul>
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