Banks have data across the customer journey – right from new product or service purchases, in person interactions around customer service to digital interfaces which are increasingly becoming self-service.
Benefits of bancassurance
This data has been put to use by Banks to cross sell and up sell products and services to their customers. Selling Insurance products through banks, for instance, allows customers to amalgamate all their financial services under one roof. In most cases, customers have trust in their bank, making bancassurance /cross-sell of insurance a natural value add.
Studies also show that customers are more likely to renew their insurance policy if it is bought from banks. Real-time information accessibility due to the banks’ access to data and documentation also helps in reducing the turnaround time.
It is a win-win for the banks, insurance companies and the customers. Banks can earn good margins by selling insurance products as compared to other products such as mutual funds, while insurance companies are able to expand their customer base without having to expand their sales forces or pay commissions to insurance agents or brokers.
The banks are also able to use their fixed capacity resources more efficiently, take advantage of enormous economies of scale and deal with demand fluctuations for ordinary banking products.
Bancassurance may also help banks to attract new customers and to build strong relationships with existing customers. As customers acquire additional services or products from a financial service provider, the number of contact points with the provider increases, leading to higher switching costs for the customers.
How Insurance Analytics Suite can benefit Bancassurance
Insurance Analytics Suite from Pentation Analytics empowers Banks to utilize the power of analytics for customer segmentation and profiling, risk assessment and revenue growth. The Customer Lifetime Value module enables Banks to tap into and make sense of the wealth of data they have on their customers. This data can then be used to cross sell and upsell.
Insurance Analytics Suite is uniquely positioned to utilize datasets around Banking products such as Loans, Cards, Business Banking to identify need for insurance products.