Bancassurance has always lured financial services providers. However, it is yet to take off widely as a business model. More than anything else, the key to successful bancassurance business model lies in understanding and satisfying varied needs of customers.
One
of the most significant changes in the financial
services sector over the past few years has been the
appearance and development of bancassurance. It is based
on the integration of banks and insurance companies.
Enticed by synergies, economies of scale and higher
revenues from cross-selling banking products to
insurance customers, and vice versa, banking
institutions and insurance companies have found
bancassurance to be an attractive and often profitable
complement to their existing activities. It covers a
wide range of detailed arrangements between banks and
insurance, but in all cases it includes the provision of
insurance and banking products from the same sources or
the same customer base.
Because
there is wide diversity of strategies, there is no
standard model for bancassurance, even within a country.
For instance, in the European region there is no common
bancassurance experience, even for the same organization
serving several European countries. While bancassurance
has picked up fast in the nations like France and
Canada, the pace has not been proportional in the
countries like US, Japan etc.
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