Summary
Having a substantial customer base with products that have a common thread drives bancassurance as a distribution system. The local regulatory regime is crucial to development of bancassurance in any country. The internal culture in a bank entering into a bancassurance approach will be vital to success. Change is often required particularly in developing a sales culture.
Analysis
Wherever there are customers there is the opportunity to sell insurance product. This is particularly true where the banking product and the insurance product(s) have a common thread, e.g. mortgages have a natural link to life and disability insurance and to home and contents insurance.
Similarly loans have a link with credit insurance, and so on.
In many markets regulatory restrictions have held up the development of bancassurance, whereas in others there has been significant development. For example today all the major banks are in the top 10 life insurers in Australia. 20 years ago this was not the case.
In Asia there have been significant developments in bancassurance in many countries and this will certainly continue as markets free up. The internal culture within a bank will be a vital factor in developing a successful bancassurance model. Often change is required to some aspects of the traditional culture. Each country will have different cultural considerations as well and any model will need to encompass the total picture for success.
