Banks Put P-C Products Into Offerings
Many banks have effectively incorporated the distribution of personal lines insurance products of partnering insurance companies into their suites of products and services.
Implications for p-c insurers:
There is continued pressure to share personal customer information exerted by business partners.
There is increasing experimentation with the bundling of bank products and insurance coverage with a basic product purchase, such as auto insurance coverage included in the price of the car, and covered by the financing.
Partners are exploring opportunities to develop product arrays fitting different underwriting profiles, so that banks will never have to tell customers that they dont qualify for insurance coverage.
Customer loyalty is at risk. Customers associate their insurance coverage with their bank relationship, not with the insurance company. Banks, in turn, concerned that poor insurer service or adverse decisions on claim settlements may harm their customer relationship, are exerting pressure on the way claims are handled.
Insurers are reacting to the combination of banking and insurance services by forming or purchasing banks to integrate banking functions into their distribution systems, avoiding the need for an independent partner providing first contact with customers.
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, July 30, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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