Originated in France in 1980s Spread rapidly across Europe Introduced in India in 1999 Opening up of insurance industry 20 new companies
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
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
• French Term• Standardized Mass Product• Easy to understand / easy to sell• Sold though a bank distribution channel
Insurance + Banking= Bancassurance The provision of insurance and banking products and services through a common distribution channel or to a common client base.
Bank Insurance CompanyCustomer retention Revenue and channel diversificationSatisfaction of more financial Quality customer accessneeds under the same roofRevenue diversification Quicker geographical reachMore profitable resource Creation of brand equityutilisationEnriched work environment Leverage service synergies with BankEstablish sales orientated culture Establish a low cost acquisition channel
Bajaj Allianz General Insurance Co Ltd. has tie-up with Karur Vysya Bank The Birla Sun life Insurance Company has a tie-up with the following banks : Bank of Rajasthan Bank of Muscat Dutch Bank Catholic Syrian Bank ING Life Insurance ties up with Vizag co-op bank Max New York Life Insurance has it’s Tie-up with Axis Bank
Max New York Life Insurance and Axis Bank havesigned a 10-year bancassurance relationship• Max New York Life Insurance (MNYL), the seventh-largest life insurance company in India.• Axis Bank is the third-largest private bank in India• To provide customized life insurance solutions tocustomers via the bank’s network.
LIC: The insurance company LIC of India have tie up with the following bank for Bancassurance. They are: -Corporation BankIndian Overseas BankCenturion BankSahara District Central Co-operative bankJanta Urban Co-operative bankOriental Bank of Commerce
Career Agents Special Advisers Salaried Agents Bank Employees / Platform Banking Corporate Agencies and Brokerage Firms Direct Response Internet e-Brokerage Outside Lead Generating Techniques
Strengths • Vast untapped market • Huge pool of skilled professionals
Weakness Lack of networking among bank branches Saving Ability of Middle Class
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
Threats Human Resource Challenges Non-response from the target groups can also pose a challenge