INSURANCE PENETRATION

As less than 10 per cent of Indians have life insurance cover, the way
forward to increase life insurance penetration is through
bancassurance.The bancassurance channel involves banks selling life
insurance to their clients.
Bancassurance is an important channel through which insurance cover
can be increased. Banks are accessible to almost the entire
population, and there is a level of trust that enables the selling of
insurance.
The lack of awareness runs deeper. Even people who have bought it
see it as a savings instrument and not as protection against accidents.
The survey finds that the primary reason respondents invested life
insurance was to use it as a savings instrument. Seventy five per cent
of the respondents marked saving for future needs like childs
marriage, education, etc., as the primary reason for investing in life
insurance.
A collaborative effort is required between banks and insurers for
developing a robust need-based selling process.