Bancassurance World
Editorial
Recession and Bancassurance
The spotlight on the financial sector has shifted as the current global recession has brought bancassurance into focus. Banks have tightened their purse and are no longer lending. The world suddenly appear to have become risk averse; banks are not eager to lend and consumers are not eager to spend. Banks are now looking to bancassurance to feed them with fee income earned out of insurance cross-sales.
The Online News Journal
January 2009
Issue 1
Monthly Online Journal
Banks' looking to insurance at this hour of crisis is not unusual. The very foundation of bancassurance from banks' point of view has been to diversify risk, i.e. when core banking revenue from interest income dwindles, fee income from bancassurance would supplement. Unlike the core banking asset and liability products, the sale of bancassurance product does not have the side effects of NPL (non performing loans). Banks also don't have to worry about the cost of funds as they will always get their share of commission from the bancassurance product sales.
Insurance industry is pretending as if recession has bypassed them and that AIG was an abberation. They however must not forget that insurance cycle closely follows the general economic cycle and the recession is bound to hit them sooner than later. The intensity and severity however may not be as much, since they have had time to prepare themselves by working on alternative strategies.
Insurance industry and bancassurance actually can gain under this recessionary conditions. New products like job loss guarantee and GAP can actually help banks and automible dealers respectively to revamp their products and attract more customers who are currently looking the other way. Banks who took to bancassurance in the proper way before the recession set in, shall have advantage over their peers. Banks who thought bancassurance was unimportant to them, should rethink as fee income from insurance cross-sales can compensate at least in part for the loss of income from the interest bearing banking products.
Recession shall come and go but bancassurance is here to stay.
Top Bancassurance News
| HSBC sells general insurance biz for $914 mln - Reuters UK The deal, the latest in a series of cost cut initiatives under the new HSBC CEO Stuart Gulliver, includes a 10-year bancassurance agreements with AXA and QBE. HSBC has cut 11,000 jobs and sold 19 businesses as part of Gulliver's plan to cut ... Banks home in on fee-based income - star.com.my Among the areas that they are strongly focusing on to garner a larger slice of the non-interest income business are in investment banking and treasury activities, wealth management and bancassurance. OCBC Bank (Malaysia) Bhd, whose non-interest income ... Life Insurance in Argentina, Trends and Opportunities to 2016 - new market resea... Argentine life insurance is highly reliant on the bancassurance channel for distribution. During the review period, insurers recognized bancassurance as an important and cost-effective channel for the distribution of life insurance due to the significant ... Biba 2012: DUAL launches Singapore operation - Insurancetimes.co.uk bancassurance as well as direct. Mark Spadaccini, who is currently managing DUAL?s Western Australian operations, will move to Singapore in August to lead the new operation. DUAL Hong Kong manager Philip Chiu has led the group?s expansion into ... ING employees to assit bank sales staff - Nation - Thailand To achieve more consistent premiums, ING Life Ltd plans to make the sale of life-insurance products through the bancassurance channel simpler and quicker, and seeks to boost the efficiency of sales staff. Chief bancassurance officer Poolap Penkitti said ... KBC Group NV - Strategy and SWOT Report - new company profile report - Transworl... KBC Group NV ('KBC Group' or 'KBC' or the 'group') is an integrated bancassurance group, engaged in the provision of retail and private banking, insurance services, asset management, corporate services and other financial services. The group operates ... Lloyds Banking Group plc - Yahoo Finance In addition, this division operates as a general insurance and bancassurance distributor, and offers range of long-term savings, investment, and general insurance products. Its Wholesale division provides banking and related services to multinational ... Bahrain: Insurance looks to steady growth - Zawya.com Looking to build on recent successes, Bahrain's insurance sector is reaching out to potential clients through greater use of tools such as bancassurance. The sector is also hoping plans for increased infrastructure spending will boost the call for coverage ... KPI boosting retail customer base to double return on equity - Nation - Thailand The company will work through the bancassurance channel and co-develop product bundling with KTB. Premiums through bancassurance account for 50 per cent, with the rest from telemarketing and agents. Gross premiums this year are expected to grow by 21 per ... Adviser Workshop: What are the pros and cons of hiring former bank advisers? - C... For me, the biggest benefit was having known the individuals I hired for a long time [I used to work at HSBC], so perhaps my reasons for employing someone from the bancassurance sector are different, but I still think there are benefits. |
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