Such a comparison is particularly pertinent in Taiwan, where the bancassurance model has grown increasingly important in response to the “over-banking” problem and the passage of the Financial Holding Company Law in 2001.
This law allows insurance companies, banks and securities firms to affiliate with common ownership and cross-sell financial products and services, and thus to eliminate overcapacity or overlap many banks have turned to the bancassurance model.
This study offers a comparison of bancassurance and traditional sales channels in Taiwan.
Using a data envelopment analysis approach, this study first computes the efficiencies of bancassurance and traditional sales channels separately.
There was a time in the past when insurance policies were meant for a small part of public who were financially strong.
Dissertation Report On Bancassurance
Today the scenario has completely changed wherein insurance policies reach every person in almost every corner of our nation.
Banks and insurance companies engage in bancassurance activities under various strategic umbrellas, though according to the Organisation for Economic Co-operation and Development, banks generally pursue minority or majority holdings, full-fledged acquisitions, the creation of subsidiaries or joint ventures with holding companies.
The importance of bancassurance mergers in both European and U. financial systems In contrast, few researchers have explored the efficiency of alternative operating strategies, such as those that emerge when bancassurance products provided by a bank subsidiary come to be regarded as in-house products claims that banks sell multiple products for economic reasons, such as the efficient use of fixed capacity resources, customer demand for multiple products from a single channel, and the appeal of a product combination strategy.
But with their single-minded focus on banks, these studies cannot offer a comparative analysis of the efficiency of different insurance product channels from a distribution perspective.
In contrast, this study develops a unique database that includes financial data from insurance brokers and agencies in Taiwan; this data indicates the premiums and commissions earned from both traditional sales channels and bancassurance channels for each insurance company.