Presentation: Russian Bancassurance Market in an International Context

The Russian Bancassurance Market in an International Context

TheBancassurance Models in an
Russian Bancassurance Market
International World
Around the Context
4th Annual Conference 'Bancassurance in Russia and CIS'
Moscow, February 27th – 28th 2014

© Finaccord Ltd., 2014

Web: www.finaccord.com. E-mail: info@finaccord.com

1


Agenda
 Key factors that shape bancassurance markets
 Key success factors for bancassurance
 Bancassurance strategies on a meta level
 The Russian bancassurance market in an European context

 The market for creditor insurance as a key segment for
bancassurance
 Summary



2


Key factors that shape bancassurance strategies
1. Meta level:

Regulation

Forced divestment

Bancassurance
Strategies

2. Country level:


Regulation

Market characteristics


3


Key factors that shape bancassurance strategies
1. Meta level
New regulation:

New capital requirements under the
Basel III Accords

Forced divestment:

Several banking groups have been
forced to divest assets

2. Country level
Regulation:

Mediation laws, insurance shareholding
of banks, product regulation

Market characteristics:

Maturity, insurance penetration



4


Key success factors for bancassurance
Developed markets

Russia

Commitment of banks to insurance



Developing

Large market for investment-related
insurance





Large consumer lending market



Developing

Tight and cultivated bancassurance
partnerships



Developing

Staff training



Underdeveloped

Tailormade products for the bank



Underdeveloped



5


Bancassurance strategies on a meta level
Segmentation of the world's 125 largest retail banking groups between those with captive underwriters,
those with joint venture underwriters and those with both captive and joint venture underwriters, 2013

None, 34.4%
Captive,
41.6%

Captive and
joint venture,
13.6%

Joint
venture,
10.4%

Source: Finaccord Global Bancassurance reports


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Bancassurance strategies on a meta level: captives and JVs
Ranking of banking groups by value of premiums of captive and joint venture underwriters, 2012

Rank Group
French
French
French
French

1
2
3
4
5
6
7
8
9
10

Premiums (USD billion)

Crédit Agricole
Divesting
ING Group
BNP Paribas
"Role model of success"
Bradesco
Crédit Mutuel
Lloyds Banking Group
Société Générale
Divesting
HSBC
NongHyup Bank
Intesa Sanpaolo

29.00
26.07
25.47
21.13
15.17
13.13
13.09
13.04
9.11
7.28

Total of above

172.49

Other retail banking
groups in world's top 125

164.52

Grand total

337.01



7


Bancassurance strategies on a meta
level: strategic partnerships
Segmentation of 125 retail banking groups between those with and
those without one or more strategic insurance partners, 2013

One or more
strategic
insurance
partners,
41.6%
No strategic
insurance
partner,
58.4%



8


The Russian insurance market in a European context
The size of the Russian life insurance market compared to other key European markets, 2013 (EUR billion)
140
120.6
120
100
72.7

80
60
40

29.4

20
0

8.6
France

Italy

Belgium

Poland

3.4
Russia



9


The Russian insurance market in a European context
Segmentation of the Russian life insurance market compared to other European markets
Protection -related life insurance
Retirement savings

Investment - related life insurance

100%

80%

60%

40%

20%

0%
France

Italy

Belgium

Poland

Russia



10


The importance of the bancassurance channel
Estimated distribution share of bancassurance in total life insurance, 2012 / 2013

100%

80%

Where would you see Russia
in five years?

60%

40%

20%

0%
ES

FR

RU

PL

IT

CN

DE

UK



11


The creditor insurance market
Size of the Russian consumer lending market compared to other European countries, 2013 (EUR billion)
Mortgage balances outstanding

Non -mortgage balances outstanding

1,400
1,200
1,000
800
600
400
200
0

France

Spain

Italy

Russia

Belgium

Poland



12


Size of the Russian consumer lending market compared to other European countries, 2013 (EUR / capita)
Mortgage balances per capita

Non-mortgage balances per capita

25,000

20,000

15,000

10,000

5,000

0
Belgium

France

Spain

Italy

Poland

Russia



13


Size of total consumer lending markets, 2009, 2013 with a forecast to 2017 (EUR billion)
1,400

France
1,200
1,000
800

Spain

600

Italy

400

Russia
Belgium

200

Poland
0
2009

2013

2017



14


Creditor insurance premiums as a percentage of the total consumer lending market, 2013
Temporary incapacity / unemployment cover
Death / permanent disability cover
1.0%
0.77%

0.8%
0.60%
0.6%

0.4%

0.2%

0.0%
Average of FR / IT / PL / ES

Russia



15


New and used passenger car finance market in Russia, segmented by distribution channel: values

Passenger car finance gross advances / assets leased (RUB billion)
1,250
Used – direct lending
1,000

New – direct lending
Used – point-of-sale

750

500
New – point-of-sale
250

0
2008

2009

2010

2011

2012

Source: Finaccord Global Consumer Automotive Financial Services reports


16


Take-up rates (where available) of creditor and GAP insurance through automotive dealers, 2013
100%

Creditor insurance

GAP insurance

80%
61.6%
60%

41.6%
40%
22.8%
20%
7.7%
0%
Average of BE / ES / FR / IT / PL

Russia

Note – take-up rate for creditor insurance is for car buyers who take out finance or leasing through car dealers; take-up rate for
GAP insurance is for all car buyers purchasing through car dealers
Source: Finaccord Global Consumer Automotive Financial Services reports


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Summary
 The global bancassurance market remains in a state of
continuing flux caused by a variety of factors

 In a large number of European markets bancassurance is
the leading distribution channel for life insurance products
Russian bancassurance has developed rapidly in recent
years but is still a long way from the most advanced
European markets
 Creditor insurance and investment-related life insurance
are likely to offer the greatest potential



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Any questions?
Sources and related Finaccord publications:
Global Bancassurance: Strategies of the World's Top 125 Retail Banking Groups
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 in Russia: Life, Non-Life And Creditor Insurance
Bancassurance country reports (covering 30+ different countries in the Asia-Pacific region, Europe and Latin America)



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Presentation: Russian Bancassurance Market in an International Context

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