KBank targets mass market for bancassurance
KASIKORNBANK, the leader in bancassurance, is strongly tapping mass-market customers. Executive vice president Pakorn Partnapart said yesterday that of its total customer base of 12 million, about half were in the mass market, and 1 million of them were
Only 10 per cent of KBank’s mass-market customers have life insurance, compared with wealthy customers for whom the proportion is 20-30 per cent.
He said affluent and high-net-worth customers held annuity and retirement insurance to accumulate wealth, unlike mass-market customers, who wanted insurance that protects them.
Pakorn said the bank aimed to increase the proportion of mass-market customers with insurance policies to 20-30 per cent by next year.
The bank will start focusing on he upper mass-market segment, especially self-employed customers who have monthly incomes of Bt15,000-Bt25,000. Its research found that people in this income bracket favoured daily premiums of up to Bt20 and required indemnification against accident or illness that affects their ability to work.
A new life-insurance product called “Can’t Work, Don’t Worry” offers low premiums starting at Bt19 per day and daily hospital benefits of Bt500 for up to 365 days in case of accident or illness. The programme offers coverage of up to 200 per cent of the total sum insured of Bt100,000. This programme is expected to draw 20,000 new policyholders with total premiums of Bt140 million by the end of this year.
Nationwide, the proportion of Thais with insurance rose last year to 32 per cent from 22.4 per cent in 2008 thanks to the increasing role of bancassurance. KBank hopes that its plan to design insurance products for the mass market will help expand this penetration rate, Pakorn said.
He said the bank would work together with Muang Thai Insurance in co-developing non-life insurance programmes next year and building awareness among general customers, who can buy such products at the bank’s branches.
Premiums from non-life insurance amount to around Bt1 billion compared with Bt11 billion from life insurance.
In the first six months, KBank reported first-year premiums of Bt11 billion, an increase of 39 per cent year on year, and total premiums of Bt21 billion, up 34 per cent.
The bank now expects its total premiums this year could reach Bt40 billion, up by 18 per cent year on year, against the previous target of Bt36 billion. Meanwhile first-year premiums could reach Bt20 billion, up by 25 per cent year on year, after premiums for the first six months showed higher-than-expected growth.
