'Bancasurrance can help increase India's life insurance penetration'

With less than 10 percent of India's population being insured, "Bancassurance" can help increase penetration of life insurance policies as banks are widespread and trusted partners in whom customers have confidence, an industry leader said on Wednesday.

"From customer's standpoint, bank is a trusted partner. They have more trust or confidence in going through the bank branch where they go for their banking business and buy a policy from there," said Anuj Mathur, chief executive of Canara HSBC Oriental Bank of Commerce Life Insurance Co, at the release here of a survey his company has jointly carried out with industry chamber Ficci.

"Bancassurance is a channel that can reach those customers in Tier-II and Tier-III cities," Mathur said.

The survey - "Life Insurance: A Consumers' Perspective" - is an exhaustive report having sampled over five thousand people in 30 cities to bring out the consumer perspective, which reveals lack of sufficient awareness of insurance, said Ficci secretary general A. Didar Singh.

Mathur said the focus of the survey was to provide right advice to the customer and ensure that there is an ongoing customer service available.

"I talked about orphan policies, in agency model where the insurance agent will try to get the business and after that he will not be seen around, so the policy gets orphaned," he said.

"In Bancassurance if you see, that relationship continues because the bank branch is going to be there. The branch manager may change but people will be there for customers," Mathur added.

While Bancassurance currently accounts for close to a quarter of life insurance sales in the country, schemes like the Pradhan Mantri Jeevan Jyoti Bima Yojana are helping to increase awareness of the product, the chief executive said.

The survey found that buyers of life insurance policies want to have professional assessment in helping them choose suitable insurance products, and are willing to spend time and money for it.

The survey also said more than half of the policy holders purchased life insurance policies in a planned manner.