Facebook Pixel Code

Bancassurance degrows in FY12

While bancassurance has emerged as one of the fastest growing channel of distribution for the life insurance companies over the past couple of years, it has shown degrowth for the insurers during 2011-12.

While bancassurance has emerged as one of the fastest growing channel of distribution for the life insurance companies over the past couple of years, it has shown degrowth for the insurers during 2011-12. But in the medium term, the analysts felt, bancassurance may re-emerge as one of the fastest growing channels.

According to the annual report of Irda, major insurers like HDFC Standard Life, ICICI Prudential, SBI Life and Birla Sun Life have shown decline in premium income. For HDFC Standard life total premium from bancassurance has gone down by 12%. For ICICI Prudential, the decline has been 47%. SBI Life?s premium income from bancassurance channel has declined by 28%.

According to analysts apart from a challenging macro-economic scenario and regulatory changes after September 2010, a sense of apprehension was prevailing among both customers and distributors.

?In the case of banks some other factors like slowdown in new customer acquisition and focus towards selling core banking products like CASA also impacted the sales potential for life insurance products,? said Mayank Bathwal, CFO of Birla Sun Life.

A channel wise distribution pattern for the insurers reveals that bancassurance contributes to 64% of HDFC Standard Life?s premium earned for 2011-12. It contributes to 44% of SBI Life?s premium and 37% of ICICI Prudential?s premium. Max life and Birla Sun Life earned 40% and 17% of their premiums respectively from the bancassurance channel.

Close to R1,900 crore was earned by HDFC Standard Life from the bancassurance channel.

Get live Share Market updates, Stock Market Quotes, and the latest India News and business news on Financial Express. Download the Financial Express App for the latest finance news.

First published on: 23-01-2013 at 02:23 IST
Market Data
Market Data
Today’s Most Popular Stories ×