Bancassurance overtakes tied agents to become largest channel in S'pore
Source: Asia Insurance Review | Apr 2017
Bancassurance overtook tied agency for the very first time to become the largest contributor of new life business premiums in Singapore based on full year 2016 results released by the city-state’s Life Insurance Association (LIA) last month.
Bancassurance accounted for 38% of new life business premiums in 2016 to reach S$1.25 billion (US$890 million), while the tied agency segment accounted for 37% at S$1.22 billion.
Bancassurance’s share of new life business premiums has been steadily increasing from 36% in 2014 and 37% in 2015. The growing numbers perhaps justify the high fees that banks in Singapore have charged in the last three years when signing bancassurance partnerships with insurers.
For instance, AIA had to pay US$800 million as an upfront fee to secure an exclusive distribution deal with Citibank in 2013, while Manulife paid an eye-watering US$1.2 billion to DBS in 2015.
Despite talk of disruptive innovation and automated distribution, the lure of bancassurance is still compelling many.
Asia Insurance Review is organising its 18th Asia Bancassurance conference from 15-16 May with the theme “The Lure of Bancassurance Event in A Disrupted World Innovative Distribution Strategies for Scale & Success” to set the stage for banks, insurers, strategic partners to explore innova-tive strategies and harness the power of partnerships and data to achieve a competitive edge.