Bancassurance is not a common, publicly understood, term. Yet for decades the selling of life assurance and other insurance products and services by banking institutions has been a key component of our insurance industry. It is also a key area for AMS Insurance Management, as it works with banks to securely manage these policies – many of which, quite literally, last a lifetime.
The World of Bancassurance is Changing
7 Apr, 2021
Over the last few years, New Zealand retail banks have been actively encouraging their customers to perform their transactional banking online, removing the dependency on face-to-face transactions in the bank branches. While this helps the bank increase the efficiency of branch services it does reduce the potential for customer engagement afforded by face-to-face interactions.
In removing the potential for customer engagement and upselling, banks have significantly reduced the opportunity for selling a person life insurance when they take up or move a mortgage. With the COVID-19 pandemic and New Zealand’s move to lockdown, many bank branches were closed or worked reduced hours for a significant period.
This effectively reduced the retail branch footprint. It meant bank customers became more likely to transact with their banks via internet and phone banking. Since that time, sustained use of remote banking has been maintained by customers along with reduced attendance in the bank branches.
Supporting bancassurance move to online
New Zealand high street banks are observing that the average customer visits a branch just a few times per year but uses on-line, mobile or phone banking many times per week. This trend has led to a significant reduction of sales in the Bancassurance space, where Life Insurance products are provided through the bank branches.
Banks that distribute insurances via both adviser-led channels and Bancassurance are indicating sales via advisers have reduced but not to the same extent as Bancassurance. Currently most banks do not have the capability for selling Life Insurance via their on-line channels. A lack of investment in the digital channel will erode the banks’ Life Insurance business over time. Now, more than ever before, New Zealand banks need to invest in omni-channel provision of insurances, including life insurance.
The AMS Life Insurance management solution can support digital customer interaction. We do this by providing smart integration points within our solution. This ensures the banks we work with can achieve seamless end-to-end integration, regardless of the distribution channel.
AMS Insurance Management solution can support the digital sales process and the ability for bank customers to engage online as if they were in a retail bank environment. All with the security such life-changing transactions demand. As always – if you’d like to learn more – please get in contact.