Bancassurance Business Opportunities, Problems and Challenges in India

20 Pages Posted: 19 Mar 2015

See all articles by G. S. Popli

G. S. Popli

Delhi School of Business

Rupina Popli

Delhi School of Business

Date Written: March 17, 2015

Abstract

The Insurance Companies in developed countries are using the banking channels for selling their insurance products effectively and making Bancassurance a viable source of additional fee based income for Commercial Banks. The emergence of this concept has also been one of the best developments in the financial sector of India. It provides the insurance companies a well established broad distribution network with a huge client base of commercial banks for selling their insurance products. The concept of providing all financial services under one roof by commercial banks can also be achieved through this channel in India. This paper makes a modest attempt to find out the scope and viable strategy for bancassurance models in India to make it a feasible source of income for Commercial Banks and a reliable channel for selling insurance products for insurance companies. India has one of the largest banking networks on the one hand and the lower insurance penetration and density on the other hand, which provides the best opportunity for additional source of income for commercial banks. But it has not been fully utilized to extract the insurance business and fee based income there from by the banking sector in India. While analyzing the present trend on banks handling insurance products, it highlights some of the likely issues in general as well as specific problems faced by commercial banks in India, as a result of which bancassurance business has not been able to perform as per it’s potential. The aim of this study is to understand the concern and perception of bank customers in India. The paper concludes by suggesting strategies and policies to make bancassurance a win-win situation for all the parties involved viz. the customers, the insurance companies and the commercial banks in India.

Keywords: Bancassurance, distribution network, commercial banks, insurance companies,

Suggested Citation

Popli, Gurmukh Singh and Popli, Rupina, Bancassurance Business Opportunities, Problems and Challenges in India (March 17, 2015). Available at SSRN: https://ssrn.com/abstract=2579632 or http://dx.doi.org/10.2139/ssrn.2579632

Gurmukh Singh Popli (Contact Author)

Delhi School of Business ( email )

VIPS - Technical Campus
AU Block, Outer Ring Road
Delhi, 110034
India

Rupina Popli

Delhi School of Business ( email )

VIPS - Technical Campus
AU Block, Outer Ring Road
Delhi, 110034
India

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