Finaccord presentation 2013_bancassurance models around the world_jakarta

Bancassurance Models Around the World
© Finaccord Ltd., 2013 Web: www.finaccord.com. E-mail: info@finaccord.com 1
Bancassurance Models
Around the World
Presentation at the 14th Asia Conference on
Bancassurance & Alternative Distribution Channels
Jakarta, May15th 2013

Agenda
 Key factors that shape bancassurance markets
 Importance of bancassurance as a distribution channel
 Operating models worldwide
 Creditor (payment protection) insurance
 Insurance and assistance packaged with banking
products
 Future outlook for bancassurance globally

Key Factors that Shape Bancassurance Markets
 Regulatory framework: insurance mediation laws (e.g.
marketing of products); insurance shareholding of banks
 Product regulation (e.g. product bundling)
 Market characteristics (e.g. maturity, insurance
penetration)
 National tax systems

© Finaccord Ltd., 2013 Web: www.finaccord.com. E-mail: info@finaccord.com
0%
20%
40%
60%
80%
100%
BR ES FR IT KR HK ID CN TH MX DE IN UK JP CL VN
Minimum % % range trigger
4
Importance of the bancassurance channel
Estimated distribution share of bancassurance in life insurance, 2012
Source: Finaccord Global Bancassurance Reports

0%
20%
40%
60%
80%
100%
IN CL KR BR ES TH HK ID FR UK DE MX VN IT CN JP
Minimum % % range trigger
5
Importance of the bancassurance channel
Estimated distribution share of bancassurance in non-life insurance in selected countries, 2012

Operating models used in selected countries
'The Southern Europe model' (life and non-life insurance, weighted), 2011/2012
Spain
Italy
Brazil
Mexico
0% 20% 40% 60% 80% 100%
External underwriter Multiple external underwriters Captive underwriter
JV underwriter Other tricker

'The multiple underwriters model' (life and non-life insurance, weighted), 2012
China
0% 20% 40% 60% 80% 100%
Japan
South Korea

Asia displays various other market structures (life and non-life insurance, weighted), 2012
0% 20% 40% 60% 80% 100%
Hong Kong
India
Indonesia
Thailand
Vietnam

Creditor (payment protection) insurance
 Cross-selling product in conjunction with mortgages,
consumer finance and credit cards
 In many countries effectively bundled with the underlying
banking product: near monopoly over distribution
 Improves profitability for lenders
 Abused in the UK: market imploded in recent years

Creditor (payment protection) insurance
Markets by total value (USD million), selected countries, 2012
7,470.4
6,818.2
5,392.4
3,889.7
3,703.7
804.8
365.3
0 2,000 4,000 6,000 8,000
France
Germany
Japan
Brazil
Spain
Thailand
Indonesia
7,470
6,818
5,392
3,890
3,704
805
365

 Niche and high margin products
 Increase banking customer loyalty
 Can be packaged with payment cards and current
accounts
Packaged insurance and assistance

Market value split by cover type in 20 European countries (USD million), 2012
Accident /
health, 138
Creditor
insurance -
credit cards,
2,075
Personal /
identity
protection,
1,854
Shopping, 94
Travel, 374
Other, 365
Concierge,
243
Total: USD 5,143
million

Market value split between policies paid for by banks and paid for by customers in 20 European
countries (USD million), 2012
Paid for by
banks, 1,015
Paid for by
customers,
4,127

France, 1,346
UK, 1,230
Turkey, 501
Italy, 454
Spain, 282
Other, 1,330
14
Market value split between 20 European countries (USD million), 2012

Future for bancassurance globally
 High growth countries: Latin American countries +
Asian emerging countries
 Low growth countries: Northern European countries +
developed Asian countries + North America
 Problematic countries: Southern European countries +
UK
 Opportunities: African / Middle Eastern countries

Any questions?
Sources and related Finaccord publications:
Creditor Insurance in Latin America
Creditor Insurance in Northern, Central and Eastern Europe
Creditor Insurance in Southern and Western Europe
Life Bancassurance in the Asia-Pacific Region: Investment-Related Life Insurance and Retirement Savings
Life Bancassurance in the Asia-Pacific Region: Protection-Related Life Insurance
Life Bancassurance in Europe: Investment-Related Life Insurance and Retirement Savings
Life Bancassurance in Europe: Protection-Related Life Insurance
Life Bancassurance in Latin America: Protection-Related Life Insurance
Non-Life Bancassurance in Europe: Accident and Health Insurance
Non-Life Bancassurance in Europe: Motor and Household Insurance
Bancassurance country reports (covering 30 different countries in the Asia-Pacific region, Europe and
Latin America)
Insurance and Assistance linked to Payment Cards and Bank Accounts in Major Global Markets
Insurance and Assistance linked to Payment Cards and Bank Accounts in Northern and Central Europe
Insurance and Assistance linked to Payment Cards and Bank Accounts in Southern and Western Europe
Card Protection Metrics: Consumer Approaches to Card Protection Insurance in Europe
Creditor Metrics: Consumer Approaches to Payment Protection Insurance in Europe
Life Protection Metrics: Consumer Approaches to Protection-Related Life Insurance in Europe

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