Bancassurance Market

Market Overview:

The global bancassurance market size reached US$ 1,354 Billion in 2022. Looking forward, IMARC Group expects the market to reach US$ 1,888 Billion by 2028, exhibiting a growth rate (CAGR) of 5.6% during 2023-2028. The implementation of various strategies by insurance companies to expand their consumer base, increasing economic growth in developing economies leading to inflating disposable income levels, and the escalating need for health and life insurance as well as retirement product plans among the masses, particularly the growing geriatric population, represent some of the key factors driving the market.

The Implementation of Various Strategies by Insurance Companies to Expand their Consumer Base Is Propelling the Market Growth

The bancassurance market is primarily being driven by the growing efforts of insurance companies to expand their customer base through various strategies. These strategies capitalize on the extensive branch networks of banks, which have a significant market presence. The success of bancassurance also relies on the relationships that banks have built with their customers over time, and insurance companies are leveraging these relationships to expand their own client base. Overall, the adoption of these strategies is contributing to the growth of the global bancassurance market.

Competitive analysis such as market structure, market share by key players, player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant has been covered in the report. Also, detailed profiles of all major companies have been provided. The market structure is highly fragmented with numerous small and large players operating in the industry. The volume of new entrants is moderate in the bancassurance industry due to the low product differentiation and switching costs, and the requirement of economies of scale.

What is Bancassurance?

Bancassurance refers to the partnership between banks and insurance firms that allows banks to generate additional revenue by selling the insurance products of the firm. This collaboration allows the insurance company to utilize the bank as a distribution channel, thereby facilitating the sale of their products and services, while also providing the bank with fee-based income in addition to interest. Through bancassurance, these financial institutions can offer a broad range of products and services, such as credit life, mortgage, life insurance, accident and health insurance, and annuities. Bancassurance helps banks offer an extensive portfolio of financial products, using which banks increase their turnover with minimal or no capital investment, resulting in higher returns on equity. Moreover, this partnership benefits the insurance firms as well, as they can leverage the extensive distribution channels of banks to expand their market reach and attract more customers. Given the mutual benefits of this arrangement, bancassurance is rapidly gaining traction across the globe.

COVID-19 Impact:

The COVID-19 pandemic had a significant impact on the bancassurance industry, causing unprecedented challenges for numerous companies. The pandemic has disrupted businesses across sectors and led to massive operation changes, that include life, general, and health insurance, ranging from employee and business continuity issues to operating profit. The extended lockdown has resulted in a halt of both domestic and international supply chains, leading companies across sectors depend heavily on digital architecture and cut costs. Due to this, bank-led insurers are hoping to save on costs by reducing branch presence, while life insurers have been forced to move operations online. Additionally, the rising medical expenditure, including the cost of testing and treating COVID-19 patients, are heavily impacting the life and health insurance providers already affected by the pandemic.

Bancassurance Market Trends

The escalating need for health and life insurance as well as retirement product plans among the masses, particularly the growing geriatric population, is majorly driving the global market. In line with this, increasing economic growth in developing economies leading to inflating disposable income levels is providing an impetus to the market. Also, the increasing adoption of insurance products on the bank product portfolio to create non-interest as well as interested income streams and enhance revenue is catalyzing the growth of the global bancassurance market. Additionally, favorable initiatives implemented by government bodies and other authorities of several countries regulating bancassurance policies are resulting in a higher uptake of bancassurance arrangements among the consumers. Continual structural and functional advancements in the private banking sector is resulting in the rapid strengthening of information technology (IT) base resulting in superior customer service output to a sophisticated client base. Furthermore, the rising number of private sector banks have also increased the competition in the bancassurance service market resulting in continuous revision of policies in order to sustain the increasing market competition. Apart from this, numerous marketing strategies adopted by the key players, such as merger and acquisitions (M&As), partnerships and collaborations, to enhance their geographical presence are fueling the market growth. Some of the other factors contributing to the market include rapid consolidation in the finance sector, rising internet penetration, paradigm shift in consumer behaviors and purchasing patterns, and extensive research and development (R&D) activities.

Key Market Segmentation

IMARC Group provides an analysis of the key trends in each sub-segment of the global bancassurance market, along with forecasts for growth at the global and regional level during 2023-2028. Our report has categorized the market based on the product type and model type.

Product Type Insights:

• Life Bancassurance
• Non-Life Bancassurance
   

The report has provided a detailed breakup and analysis of the bancassurance market based on the cup type. This includes life bancassurance and non-life bancassurance. According to the report, life bancassurance represented the largest segment due to the rising awareness regarding insurance services, along with the implementation of strict guidelines on wealth management products. In addition, the growing middle-class population and inflating disposable income levels are also propelling the demand for life bancassurance services.

Model Type Insights:

• Pure Distributor
• Exclusive Partnership
• Financial Holding
• Joint Venture
   

A detailed breakup and analysis of the bancassurance market based on the model type has also been provided in the report. This includes pure distributor, exclusive partnership, financial holding, and joint venture. According to the report, pure distributor accounted for the largest market share due to considerable growth in sales opportunities with minimum investment to both banks and insurance companies. In addition to this, the rapid expansion of cooperative banks and cooperative societies, particularly in rural areas, is further creating a positive market outlook.

Regional Insights:

• Asia Pacific
• Europe
• Latin America
• North America
• Middle East and Africa
   

The report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada), Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others), Europe bancassurance market (Germany, France, the United Kingdom, Italy, Spain, Russia, and others), Latin America (Brazil, Mexico, and others), and the Middle East and Africa. According to the report, Asia Pacific was the largest market for bancassurance. Some of the factors driving the Asia Pacific bancassurance market included a considerable rise in the geriatric population, the escalating demand for health and life insurance and retirement product plans among the masses, and growing efforts of insurance companies to expand their customer base through various strategies.

Competitive Landscape:

The report has also provided a comprehensive analysis of the competitive landscape in the global bancassurance market. Some of the companies covered in the report include:

• ABN AMRO Bank N.V.
• The Australia and New Zealand Banking Group Limited
• Banco Bradesco SA
• The American Express Company
• Banco Santander, S.A.
• BNP Paribas S.A.
• The ING Group
• Wells Fargo & Company
• Barclays plc
• Intesa Sanpaolo S.p.A.
• Lloyds Banking Group plc
• Citigroup Inc.
• Crédit Agricole S.A.
• HSBC Holdings plc
• NongHyup Financial Group
• Société Générale
• Nordea Group
   

Please note that this only represents a partial list of companies, and the complete list has been provided in the report.

Report Coverage:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the bancassurance market from 2017-2028.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the global bancassurance market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the bancassurance industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.