Jubilee Insurance has partnered with Diamond Trust Bank (DTB) to to launch a referral model in Bancassurance.
The move is set to promote Life insurance which still has low penetration in the country with around 500,000 policies actively in force.
Jubilee Insurance Kenya Chief Executive Patrick Tumbo said the introduction of the referral model of Bancassurance with DTB will help in improving access to life insurance products among Kenyans.
“Having one of the fastest growing middle-class populations in the world, Kenya has lead the way in the East African region when it comes to the steady development of Bancassurance.
“However, the general lack of awareness of life insurance has given the need to promote it effectively through the retail channel of banks and this cannot be over-stated,” he said .
The model aims at providing the highest quality service levels and swift delivery to retail customers by deploying specially trained financial advisors thus Insurance savings plans will be matched to adequately meet each customers’ financial profile and needs.
Diamond Trust Bank Group CEO Nasim Devji said her bank will aim to take advantage of the opportunity especially on individual life insurance plans, which provide an effective means to save for the individual customer have not been a focus for banks.
“The referral model will greatly enhance the capability to reach more customers. Banks offering individual insurance plans through their insurance agencies have had low to medium success with high customer dropout rates. The referral model has therefore emerged as the more sustainable and viable choice, as has been the witnessed in many countries across Asia, Europe and Latin America,” she said.
In its December 2013 analysis, TechNavio estimated that the global bancassurance market will grow at a CAGR of 5.98 percent between 2014 and 2018. Much of this growth will come from the adoption of more enhanced, diversified product portfolios offered by banks, particularly in the face of further banking industry regulation that is certain to limit the profitability of lenders’ more traditional business lines.
Moreover, it would appear certain that Asia and Africa will be the principal drivers of this growth, while Europe remains strong but stagnant.
In Africa Bancassurance has also been on the rise. In a report by Finaccord it is estimated that the most popular product in the region is credit life insurance, which has been tied in with mortgages and personal loans; this is closely followed by household insurance and motor insurance, both of which are combined with specific lending facilities.
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