BBL mulls monthly premiums to woo first-jobbers to savings-linked insurance

Executive vice president Pochanee Kongkalai said that half of the premium accounted for by the bank’s bancassurance channel was currently for life insurance taken out by middle-income and affluent customers.
The low penetration rate of 20 per cent for life insurance in Thailand shows that the majority of Thais still pay little attention to this type of insurance product, she said.
For its branch-based bancassurance business, she said Bangkok Bank wanted Thais, and first-jobbers in particular, to be more aware of the savings potential from long-term insurance products, but accepted that existing features might not be sufficient to encourage more of them to take the plunge.
“Long-term savings insurance is suitable for the first-jobber segment, but the duration might not be comfortable for them, paying regular premiums in the long run. This isn’t easy, but we will design a new model for them only,” she explained.
The minimum term for premium payments for long-term savings-linked insurance should be at least 10 years, she added.
A first-jobber is normally someone on a pretty low salary and with expenses to meet, therefore the premium they pay should be small, and spread out via manageable monthly instalments in order to give them more flexibility, Pochanee said. 
Smaller, monthly instalments will also help increase their financial discipline, she added.
However, if it is going to introduce such a product, the bank must first have good data analytics and train its branch staff properly, she said.
She pointed out that they would be the first point of contact in acquiring first-jobber customers, while the right data-analytics system would help reduce the level of late payments from this customer segment.