Bancassurance puts burden of commitments on banks
The Central Bank of Nigeria’s (CBN’s) recent guideline on bancassurance called ‘Referral Model’ would mean that banks partnering with insurance companies in the deal would not be mere onlookers, expert has said.
But, that banks in the partnership will be part and parcel of the system, where its designated staff for bancassurance would understand and know how insurance operates, the expert further stated.
Doug Sumner, owner and principal of Third Sector Capital Management who lead discussion on a master class for bancassurance, jointly organised between his firm and the West African Business School in Lagos said this is important because the bank’s brand is being sought in bancassurance.
Summer who spoke on the theme “Strategy and Global Best Practice for Banks and Insurers” said “For bancassurance to succeed, the bank branch staff must understand the benefits and basic operations of insurance, and so will require training by insurance companies to give soft landing in selling the products, he said.
Participants at the training which comprised representatives from Banks, Insurance companies, international expert and the media deliberated extensively for 3 days agreeing that Bancassurance is a good development for the financial services industry in Nigeria.
According to a Communiqué issued at the end of the programmed, and signed by the West African Business School, there is a major opportunity now for Nigerian Banks and Insurers to move quickly to seize the initiative.
“There is need for cooperation and collaboration between the Central Bank of Nigeria (CBN) and National Insurance Commission (NAICOM) to ensure that the opportunities available to both key sectors of the financial industry are tapped adequately. In this regard, the regulators should see themselves as serving the same purpose – financial inclusion which could be done well in Nigeria using the vehicle of bancassurance.”
They further agreed that Bancassurance is (arguably) the most important distribution channel for insurance around the world and that the opportunities are significant for those who ‘get it right’.
“The Insurance and Bank regulators should streamline their regulatory efforts in addressing all gray areas that could create challenges of regulations on effective implementation of bancassurance channels in Nigeria.”
The forum observed that one of the areas of challenges of evolving effective bancassurance practice in Nigeria is that of awareness among the operators and their regulators, so recommended that
West Africa Business School be supported to sustain the training platform for interaction among stakeholders.
Modestus Anaesoronye