Bancassurance: Stale or Staunch?

The purpose of this research is to identify the critical drivers in bancassurance as a distribution channel of insurances. Therefore a more realistic industry outlook is defined. First, a global comparison of bancassurance is given as conducted in four different business models. The descriptive section is extended by an analysis of previous literature. Subsequently, a quantitative country-level assessment is performed. The analysis both studies the effects on life- and non-life insurances. To measure their impact on the proportional size of bancassurance, the following factors are examined; market concentration, Internet usage, size of the insurance market, level of deregulation and bank branch density. The empirical results indicate that all five variables affect bancassurance. However, the evidence for size of the insurance market only holds for the non-life sample. Size of the insurance market (only in non-life), branch density and Internet usage constrained bancassurance performance. Contrarily, market concentration and the level of deregulation are perceived to facilitate bancassurance. Overall results are stronger in the non-life sample except for Internet usage. This results are derived from a panel study among 17 European countries over 3 years and in-house industry analysis of pan-European operating retail banks by PwC. Furthermore, this research provides an increased understanding of country-specific bancassurance development as well. Keywords: