Insurance companies have been urged to invest in the training of their sales persons on Bancassurance products.

This, according to the Managing Director of NSIA Insurance, Mable Nana Nyarkoa Porbley, will encourage clients to patronise the products.

The NSIA Insurance boss made the call at the 2016 Bancassurance Conference in Accra Wednesday.

The event aimed at sharing relevant knowledge on ways to improve the provision of Bancassurance products in Ghana, brought together players in the banking, insurance and technology sectors.

Delivering a presentation on Identifying Sales Opportunities in Bancassurance, Mrs. Porbley underscored the need for insurance companies to champion the marketing of Bancassurance products.

”Insurance companies must be responsible for the sales of Bancassurance. The banks are not insurance companies” she stressed.

Mrs. Porbley said apart from investing in the sales agents, insurance companies must find innovative ways to market their products.

“We must also look at alternative markets like moving from selling to corporate only to the individuals associated with these organizations. Most of the time Banassurance products are tailored to the organizations themselves. But these organizations may have employed hundreds of workers who can easily be a target market” she added.

History of bancassurance

The concept, which originated from France, has now become a strategic business model for many insurers around Asia, Africa and Latin America, even though it was earlier prohibited in most parts of Asia. 

It also provides insurers the opportunity for additional distribution line, besides brokers, agents and direct businesses. Bancassurance has proven to be an effective and efficient distribution channel in and around the world. 

The relationship between the bank and insurance companies

An insurance company partners a bank for its range of insurance products to be sold across selected bank branches. These products typically range from life to non-life products especially motor and fire insurance. 

The insurance company is responsible for providing training to the selected staff of the bank, making them the interface with the prospective clients. The bank not only collects the premiums on behalf of the insurer, but also earns an agreed commission on all policies received from the bank. 

Through the partnership, the insurance company is able to expand its client base, without necessarily increasing its direct sales force or brokers. Unlike the typical banking products, bancassurance products, especially the investment ones, are mainly medium to long-term products. 

These products provide both investment and risks components. In the bancassurance arrangements, the design and pricing of the policies are usually affected by the nature of the target market. 

An important aspect of bancassurance is the opportunity for collating clients’ demographic information, using the bank as a conduit. This also helps in future designing and pricing of products as brand credibility becomes a major prerequisite in the partnership.