Last week, United India Insurance Company Chairman & Managing Director, G Srinivasan and Vijaya Bank Chairman and Managing Director, Albert Tauro signed a Memorandum of Understanding (MoU).
The general insurance products of United India include health insurance plans, accident plans, travel insurance plans etc. Vijaya Bank will distribute insurance policies of United India through its 1,200 plus branches in the country.
Commenting on the tie-up, H.S. Upendra Kamath, Chairman & Managing Director, Vijaya Bank, said, "Our loan book is over Rs 51,000 crore, of which at least Rs 30,000 crore have asset backing, that gives us enough scope for in-house business.”
Incidentally Vijaya Bank also has a tie-up with the country’s largest insurer, Life Insurance Corporation of India (LIC). Within 1.5 months of starting the distribution of LIC policies, the bank sold over 3,700 policies with a total premium of around Rs 12 crore.
Bancassurance tie-ups are a great way for insurance companies to reach out to customers and showcase their range of products to them. Bank customers already have an existing relationship with their banks and are comfortable in purchasing additional products through them.
Mr Kamath said, "With significant regional penetration and over 8 million customers, we hope to leverage and garner as much life insurance business as possible.”
Pointing out that currently bancassurance was available only in select centres, he added, "Since this is the first year in bancassurance, we learn the ropes this year, and would also engage in the process of creating capabilities. We do have a modest target in mind."