Bancassurance: Key growth drivers

Bancassurance is a fast-growing practice worldwide, an innovative, simple and integrated way of distributing insurance solutions. The massive use of digital tools and the modeling of customers' specific needs are driving growth in this mode.

Bancassurance has proved particularly effective in regions where banking penetration is high, and in countries where digital transformation, based on new technologies, is in full swing.

Factors driving its development include products digitalization, optimizing customer offer, artificial intelligence and regulatory framework among others.

Products and services digitalization

Access to banking and insurance services is simplified thanks to the creation of online platforms where all solutions and operations (underwriting, management, payment) are pooled together.

The digital transformation of the banking sector has in fact considerably enhanced the scope and efficiency of bancassurance. Online and mobile banking platforms have simplified the purchase of insurance products, often with just a few clicks.

As a result, operating costs are reduced, while customer experience has been enhanced.

Optimizing customer offer

Many bancassurance operators are multiplying their points of contact with customers and prospects, a strategy designed to better identify their needs and offer simple, tailor-made solutions through online assistance, satisfaction questionnaires, service evaluation, etc.

Artificial intelligence (AI) and process automation

AI is a recent technology that is bringing innovative solutions to the financial sector, including bancassurance. Thanks to tools such as big data, which analyzes a colossal volume of digital customer data, and chatbots, a software agent designed to interact with users, operations are optimized.

From offer customization to appropriate risk management, operational strategies have been brought up to date, with a view to:

• greater efficiency,
• lower costs,
• faster file processing,
• reduced human error,
• fraud detection,
• greater transparency and security.

Fintechs

More and more banking institutions and insurance companies are concluding partnerships with fintechs ⁽¹⁾ to integrate innovative, flexible solutions.

Ecosystems are, therefore, being created, combining new technologies with traditional skills.

⁽¹⁾ A fintech is a company that uses technological and digital advances to innovate in the fields of finance and banking.

Developing inclusive bancassurance

The aim is to develop new low-cost financial and insurance solutions for people with limited incomes or with specific needs (small businesses, self-employed workers).

Access to these products is provided via mobile applications or digital platforms.

The regulatory framework

Regulatory reforms have created a framework which is more conducive to the development of bancassurance.

This is the case in many countries in Asia and North Africa, where policies have been devised to encourage partnerships between banks and insurance companies.