Bancassurance: An overview

The purpose of distribution channel is to make the right quantity of the right product available at the right place and at the right time. Distribution is supposed to create time, place, and possession utility. A distribution channel is expected to perform the selling function of moving through the stages of awareness, interest, desire and action. Therefore, distribution channels need to be selected very carefully because every product requires a unique and different distributional channel, which in turn is determined, by the skill expertise and the cost base of the chosen distribution method. Appropriate distribution channels are needed through which the insurance companies can get the maximum benefits n serves the customers in manifold ways.

The time has come for the industry to gradually move from traditional individual agents towards new distributional channel with a paradigm shift in creating awareness and not just selling products. The need of the hour is Multi-channel distribution. Many Financial Consultancy Firms, Share Broking Firms, Companies working as Investment advisers have taken up corporate agencies and sell insurance to the existing customers and spread their insurance selling to new customers through the referrals given by their clientele. Another significant thing that is happening is the addition of Banks as corporate agents and marketing insurance through the banks