Performance and Growth of Bancassurance in India – An Analysis

Abstract

Bancassurance is a phenomenon wherein insurance products are offered through the distribution channels of the banks along with a complete range of banking and investment products and services. Factors such as growth of retail banking, financial diversification, economies of scale and scope, cross-selling, thrust for fee-based income, relationship management, internal resources, information technology and tendency of convergence are the factors that contributes significantly to the growth of bancassurance in India: The analysis reveals that the premium collected and its growth rate by private banking players through bancassurance channel during the study period is impressive. Similarly, the growth of share of income from bancassurance business of all Indian domestic commercial banking industry to its other income and total income during the study period is also noteworthy. Even aer the two decades of its existence, the concept of bancassurance is still under embryonic stage and could not register a remarkable progress especially in public sector banks. If nurtured properly, bancassurance can go a long way in contributing sustainably to insurance growth of the country.