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Introduction
Nowadays,the insurance industry has become an important part in our daily life.It is reported by Carow(2010) that nearly 70% people have bought certain kinds of insurance. Bancassurance,as an newly developed branch of insurance, is a collaboration between a commercial bank and an insurance company, aiming at selling insurance business to the bank's clients. In recent years, Bancassurance has become an indispensable part of the modern life for British people. It is reported that Bancassurance emerged in Trustee Saving Banks in the UK in 1967 and in the year of 1986, it gained more popularity and developed rapidly during the next decade. However, problems came out of the Bank Insurance boom, for example, a crisis of confidence of bank and a decrease of business in insurance company. As a result, the British people began to hold different views on whether buying insurance in banks or not. It will be argued that Bancassurance is a critical instrument to bring benefit to financial market in the UK. This paper begins with a review of current Bancassurance, including the definition, appearance, development of Bank Insurance in the UK, and so on. It is followed by a detailed statement of the benefits and limitations that Bancassurance brings about, and an in-depth comparison of the two views which will be investigated.

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1.Definition

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Bancassurance
Bancassurance, also known as the Bank Insurance model(BIM), is a new concept of insurance which is to set up a partnership between a bank and an insurance company whereby the insurance company sales its insurance products to the bank’s client base. The Life Insurance Marketing and Research Association’s (LIMRA’s) insurance dictionary defines Bancassurance as ‘the provision of Life insurance services by banks and building societies’. It is said that Bancassurance originated from France in the 1970s and many influential global financial companies have begun to develop bank insurance in different levels.

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There are three main stages of the development of BIM. Diacon(1990) argued that the embryonic stage is before 1980, during which, insurance companies began to sell products in commercial banks and established cooperation relationship. Although banks sold insurance products directly in this stage, it was only a supplement to the business of banks, aiming at reducing the risk borne of

banks. According to Estrella(2001), the second stage, which is regarded as the stage of the true appearance of Bancassurance, emerged in 1980s. At that time, a kind of insurance product called pension insurance was developed by banks and it became popular among customers. It was also the time when banks began to intervene in the insurance sector overall. In addition, the final stage is a significant one when BIM became mature and began to spread worldwide. Not only in forms of products, but also in organizational structure and there terms, the banks began to participate in the insurance field actively in order to stabilize the position in the competition(Estrella,2001).

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2.Sales model of Bancassurance in Britain
Bancassurance is the term to sell insurance products in commercial banks. Before that, the insurance company would give training and some support on the details of insurance products in order to make the staff of the bank learn about something about insurance and sell the products over the counter. Obviously, the insurance company would give the bank large amounts of commission relating to the sales so that they can keep this kind of relationships. Moreover, the transactions would be dealt with in the usual way by the administration of the insurance company.

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Contrasting with most traditional sales models of insurance which contains a large sales team to work through brokers and other kinds of agents to sell products to the people,this kind of sales model offers a good chance for the insurance company to gain more customers from the bank. As a...
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