Is the selling of insurance by banks a threat for insurers?
Bankassurance is not at all a threat to Insurance Companies. Rather they are joining hands with them to tap their existing clientele base. Though direct contact by Agents is more , banks have of late showing inclination in selling insurance products for mutual benefits.
Bankassurance works both way. It can be an additional service/product of the bank which can be offered to their clients. Through this, banks will have the opportunity to make an additional profit and at the same time it can help their client to manage their money in the right way, of course with the help of the insurance provider. On the otherhand, insurance company will also have the opportunity to increase their distribution channel to…
Because they can make a profit by selling those insurance products to you. If they sell insurance products, the insurance company pays them a commission. Also, in most cases, the insurance company they are tied to is a subsidiary of the parent bank and hence it is easy advertisement and publicity for their own sister concern.
1) Unlike insurance agents, banks may lack sales culture as selling a insurance product is different from insurance product. 2) It is difficult to forecast sales to be recieved from the bank employees. 3) High cost involved in giving an extensive training to bank employees. 4) Incentives need to be given to bank employees to promote insurance product.
I don't know about every state but in Georgia auto dealers are no allowed to sell auto insurance. They used to be allowed to sell insurance but that was stopped back in the early 1990's. I'm not sure if this was a state regulation or a national law but I do know that banks and auto dealers were stopped. Banks have been allowed to start back selling insurance under certain circumstances and in larger cities…
Now we have the FDIC (Federal Deposit Insurance Corporation) to protect any money we have in banks, and to also protect the banks. There was no such protection at the beginning of the great depression, people panicked and withdrew ALL their money from all the banks, and therefore the banks collapsed.
In Canada, the only company that provides reliable health insurance/travel insurance is RBC, and several of the other major banks also offer similar rates and services. In the United States however, 1000s of banks offer health so the market is intensely competitive. Go to your bank and ask them for rates. Ask around. Banks may be willing to negotiate prices so that they can get your business.
The Banking Act of 1933 established the Federal Deposit Insurance Corporation and was signed by FDR in 1933. The FDIC was insurance, backed by the federal government, for deposits in banks. Its immediate effect on the economic situation in the 1930s was to restore public confidence on banks and stop the "run on banks" that occured after the Stock Market Crash.