25 Aug Bancassurance in the Digital Era.
-Reimagining sales engagement in APAC as digital-savvy customers choose the convenience and flexibility of online financial transactions over in-person interactions.
Globally, Bancassurance has emerged as an important insurance distributions channel that has not only allowed insurance companies to expand their geographical presence but also enabled banks to expand their offerings.
Distributing Insurance through banking is increasingly attractive for the following reasons:
- Banks have a good understanding of customer savings/earnings and can give targeted recommendations.
- Customers trust bank employees.
According to a McKinsey report, Asian insurance companies focused on growth are quickly evolving their distribution strategies. They have accelerated investments in digital capabilities during the COVID-19 pandemic to support a digital-hybrid growth model for their traditional distributors—primarily agents and Bancassurance. Additionally, they are expanding into new digital-marketing and sales ecosystems, affinity partnerships, and direct-to-consumer engagements.
- Low awareness about insurance among consumers. The protection gap in the Asia-Pacific region is huge, therefore insurers continually need to develop insurance literacy to meet untapped customer demand.
- The process of lead generation is outdated and requires physical intervention. We’ve to develop advanced analytics-powered digital marketing capabilities for lead generation. The banking industry has already embraced both regulatory and technological advancements to lead the way with sophisticated digital marketing and product offerings—but we have yet to see the same developments take place with Bancassurance offerings.
- The Bancassurance success model is heavily dependent upon bank contacts. Without proper training and pertinent resources of these sales reps, insurance companies might see a dip in total premium collected.
- Emergence of omnichannel engagement. As customers become increasingly accustomed to omnichannel experiences in retail and other sectors, insurers need to adapt. This connectivity can be a sensitive issue because agents and distribution partners may both want to claim ownership of the relationship. Yet for a true omnichannel experience, it is vital that an insurer engages with customers across multiple touchpoints in person, remotely, and digitally.
- Low margins on products bring down the profitability for insurance companies. With intensified market competition, insurers are urged to compete on the commission rate to increase leads inflow from banks, thereby hurting their margins.
Forging strong relationships with banks is another key challenge. Insurers must continually maintain close communication with banks to share commitment and enhance relationships of trust by understanding one another.
The Bancassurance channel is one of the fastest-growing in the APAC region. This provides immense potential for banks and insurers to collaborate on holistic investments and insurance offerings for their customers. Here are a few ways that Bancassurance can uplevel its gameplan.
Solution capabilities that can solve these challenges
- Smart Segmentation – It is straightforward: branch segmentation drives better engagement planning. RMs will be able to proactively and strategically plan their engagements only if there is clear contact mapping and accurate prioritization of branches in the system.
- Engagement Playbooks – A rule-based engagement playbook and auto-calendared activities can help RMs with key event triggers, week-on-week business metrics of branches, highlight drops etc. to identify the branch that needs most support.
- Branch 360 – A 360 degree overview of engagement history, contact mapping and business metrics, calendar activities can help RMs enhance their engagement. Prompts for auto-detection of visits can help maintain records easily.
- Branch & Rep Analytics – A good analytics module can boost sales productivity by providing insights into rep performance and respective regional mapping, best sales behaviors, lead sourcing and allocation.
A composite and more customer-centric product offering can play a significant role in expanding the Bancassurance model.