Page 14 - Life Insurance Today July - December 2020

Studies suggests that satisfied bancassurance
customers rate the bank's reputation highly for their
satisfaction. This further highlights the bank's influence
and the customer's existing relationship.

4. Relevant Offer Generation and Customer
Engagement
Banks have a huge amount of data on their customers.
This includes their demographic and financial info,
transactional information, spending patterns, credit
repayment history (investment and purchase capability)
and more. The companies and banks can use this
information to forge intelligent engagement workflows
and to customize relevant insurance covers. ensures that the turn-around-time is low
(responsiveness is high). This is important because
5. Information on New Insurance Products to responsiveness is rated by most customers as a very
Launch important factor in insurance buying. Most studies
Learning from the success/failures of their existing disclose a timely response was rated highly in the
covers, insurance companies can launch new products decision to buy insurance.
more likely to succeed. This is possible because of the
bank's access to data on the covers garnering most Demerits of Bancassurance: -
interest in specific customer segments. Data management of an individual customer's identity and
contact details may result in the insurance company
6. Increased Operational Efficiency and Reduced utilizing the details to market their products, thus
Costs compromising on data security.
In several of the Bancassurance distribution models,
bank employees are on the forefront, closing the deals There is a possibility of conflict of interest between the other
and taking responsibility. Therefore, the channel proves products of bank and insurance policies. This could confuse
to have a much wider reach with much less investment. the customer regarding where he has to invest.
A similar reach through traditional channels would need
them to hire several hundred agents in different parts Better approach and services provided by banks to customer
of the country. Through bancassurance, their market is a hope rather than a fact. This is because many banks in
penetration goals can thus be met in a much shorter India are known for their bad customer service and this fact
timeframe than through an agency channel. turns worse when they are responsible to sell insurance
products. Work nature to market insurance products require
7. Better Customer Experience Throughout the submissive attitude, which is a point that has to be worked
Lifecycle on by many banks in India.
The entire process of origination, application
processing, underwriting, risk assessment, fund Conclusion
management, delivery, and claims is managed by the So, these advantages of bancassurance for all the involved
bank. This makes customer experience seamless and stakeholders - customers, banks and insurance, which
hassle-free because there's just one point-of-contact for outweigh the demerits, encompasses the reasons why
them. bancassurance is finding success in so many parts of the
world, including India. With these advantages leveraged
8. Improved Turn Around Times (TATs) well, the operational efficiencies and the profitability of the
Bank employees are on the forefront, data access bancassurance sales channel can be increased manifold. R

"You can only hold someone's hand for a moment, but you can hold someone's heart for a lifetime."

14 July - December 2020 Life Insurance Today