The report from financial analysis group Timetric, projects that the value of commissions earned through bancassurance is set to grow at a Compounded Annual Growth Rate (CAGR) of 5.29% globally between 2013 and 2017. However, Timetric said this growth is not evenly distributed between regions, with the “distinct features of emerging markets fostering the vast majority of this growth”.
According to the report, Europe’s emerging markets of Turkey and Poland are set to grow significantly, with a projected combined average CAGR of 14.94%. Timetric said this is primarily due to the low levels of insurance penetration in those countries, coupled with attractive investment related life insurance and retirement savings products that are in high demand.
Similarly, the Asia Pacific region where bancassurance is described by Timetric as “still an emerging channel” is predicted to grow due to a number of factors, not least declining interest rates which have sparked demand for savings based insurance products. Timetric predict growth in the region to be around 19.04% between 2006 and 2016.
Another region offering growth is Latin America. Timetric said while there is relatively high penetration of bancassurance in countries such as Mexico and Brazil, in other countries “a combination of low insurance penetration and high bank penetration presents significant growth potential for bancassurance ventures”.