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Journal of Financial Services Research

Erschienen in:

01.06.2008

Does Bancassurance Reduce the Price of Financial Service Products?

verfasst von: C. Charles Okeahalam

Erschienen in: Journal of Financial Services Research | Ausgabe 3/2008

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Abstract

I assess the impact of bancassurance on the price of retail financial services. I find that service fees in a product bundle increase less than proportionally to the number of services; that an increase in the number of clients in each product bundle market reduces fees by 1.5%; that the degree of competition in the markets of each bundle also reduces fees; that premium products have higher average costs; and finally, that cross-holdings reduce prices by about 5% and bancassurance reduces prices by just over 6%. The price reduction declines if both strategies are combined.

Nächster Artikel Bank Liability Structure, FDIC Loss, and Time to Failure: A Quantile Regression Approach

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Market share for short-term insurers is a weighted average of total balance sheet assets and gross premiums written, while for long-term insurers, it is a weighted average of total balance sheet assets and total investments.

Specific insurance products are insurance products which are not linked to a bank product.

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One way of doing this would be to calculate the sum of total liabilities due or claimable on purchase of each type of FSP. For the banks, the five deposit products are the average rate of interest to be paid on each product. The insurance benefit is contingent. A historical average of the annual payouts made for each FSP bundle in each cohort has been used to obtain measures of the contingent benefit. Clearly this would not be an actuarial measure. Yet it effectively relates the average potential ex ante costs of providing the product and relates this to the price to be paid by the DFSF.

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Titel: Does Bancassurance Reduce the Price of Financial Service Products?
verfasst von: C. Charles Okeahalam
Publikationsdatum: 01.06.2008
Verlag: Springer US
Erschienen in: Journal of Financial Services Research / Ausgabe 3/2008
Print ISSN: 0920-8550
Elektronische ISSN: 1573-0735
DOI: https://doi.org/10.1007/s10693-008-0031-x