Some marriages prove more fruitful than others, bestowing prosperity on those who learn to make the most of what life brings by successfully building on each other’s strengths.
Such has been the experience of European banks and insurers that have entered into bancassurance agreements, which permits banks to diversify their revenue streams by serving as insurance distribution partners while supplying insurers with a potentially very efficient distribution network.
Bancassurance relationships originally focused on financial and life products, as these were viewed by banks as the most natural “fit,” with insurers. However, today, leading bank and insurance executives agree there’s a seismic shift occurring, according to CXO perspectives: A conversation on the future of bancassurance, McKinsey & Company, April 15, 2021.
Driven by customer demand for digital experiences prior to COVID-19 and the pandemic’s acceleration of expectations for purchasing everything online, banks are seeking to gain more wallet share by proving they’re the right partner for addressing any customer insurance need. Insurers are responding by distributing more business lines via banking channels.
The adoption of this mindset has spawned several distinct trends critical to success in the evolving bancassurance landscape. They include:
- Developing and executing a customer-centric strategy to build solutions, marketing, and sales around customer life stages, interpersonal relationships, and insurance requirements (i.e., mandatory vs. discretionary), rather than the traditional product-centric, one-off sales approach.
- Significantly improving the ability to seek and capture digitally-driven market opportunities efficiently and effectively by leveraging technology to carry out the strategic customer-centric vision.
- Steady introduction of complementary services based on the customer-centric approach, typically delivered by non-bancassurance partners, to differentiate solutions and improve customer engagement. For example, a bank offering homeowners insurance along with a home monitoring service that’s connected to a 24/7 call center.
- Escalating pressure to adopt an ecosystem-based approach where customers transfer effortlessly between partners, such as when a customer uses a banking app to purchase insurance and passes seamlessly to the insurer’s app for policy servicing and claims.
- Expanded utilization of analytics and digital marketing to deliver effective, personalized offers to the right leads at the right time.
- Increasing customization by banks of their insurance offerings using publicly available data combined with internal bank insights.
- Greater claims digitalization for improving customer experiences, retention, and pricing.
Next-generation Bancassurance Enabling Platform: Coretech
Regardless of which side of the bancassurance equation you’re on, it’s clear that you need an enabling technology system that infuses agility and flexibility into the processes of harvesting, mining, processing, analyzing, and utilizing data while also ensuring information flows securely and rapidly between entities. Further, it all needs to happen in real time at scale, without infringing on each partner’s proprietary data.
Enter coretech. Unlike other types of core banking or even relatively recent insurance systems, coretech platforms were designed and developed to harness the power of mobile apps, digital transformations, and the ecosystem economy.
Coretech platforms use a customer-centric model similar to a fintech or an insurtech. This allows bancassurance partners to leverage customer data to cross sell and up sell many different types of insurance policies and third-party services to a single customer, across any product line, from a consolidated view of the customer on a flexible and scalable platform.
From a technology perspective, coretech solutions use the latest cloud advances to provide you with a platform for building a bancassurance ecosystem. As a coretech solution can interact with any underlying banking or insurance core systems, as well as third-party provider subsystems. Coretech empowers bancassurance participants to quickly innovate as market demands shift.
In other words, coretech platforms can be deployed by individual bancassurance partners to serve as the interconnection system. Or, a single coretech platform can be used for a greenfield bancassurance initiative that combines teams from ecosystem partners and serves as the central processing solution.
No matter which route you chose, coretech enables truly channel-less experiences across all partnering entities, transparently and in real time.
What are the Attributes of Leading Coretech Platforms?
To select a technology platform that can assist with executing your bancassurance vision, look for these critical attributes.
Open. Ensures unfettered, inbound and outbound interactions through APIs and events while being easily adaptable to your needs in the bancassurance marketplace.
Customer centric. Permits the introduction of any product, in any channel, and sold to any customer using thousands of open source APIs. It provides low-code tools and leverages AI-assisted automation to blend channels into a unified or “channel-less” experience, whether B2C, B2B, or B2B2C.
Cloud native. Purpose built for the cloud, featuring secure microservices architectures, containerization, event-driven capabilities, cloud platform agnostic, rapidly scalable, and natively resilient. Beware modern legacy solutions that have simply been deployed on a cloud platform, called “lift-and-shift,” and be sure to read the fine print closely.
SaaS delivered. Empowers you to focus on your bancassurance strategy while the platform provides the performance, reliability, security, scalability, and compliance you need. All in a package with predictable pricing and the same, or greater, extensibility as an owned deployment.
DevOps enabled. For rapid implementation, innovation, and transformation with fast and low-cost product launches, non-disruptive upgrades, automated builds, and continuous agile cycles that integrate, deploy and deliver new or updated products. In addition, coretech provides DevOps that reduces your IT training needs and increases management efficiency through cross-platform infrastructure-as-code (IaC).
Cost effective. By moving capital expenditures to operating expenses, a leading coretech platform promotes cost predictability and reduces risk, which lowers TCO and generates faster ROI.
In short, a leading coretech platform supplies you with the critical technology enabling layer for establishing and continuously evolving your bancassurance strategy, initiatives and relationships. With it, you can profitably navigate the bancassurance trends of today as well as address whatever challenges and opportunities come next.
For a more detailed overview of coretech, download the ebook “When Insurtech Meets Coretech, the Customer Wins.” For more on using a greenfield approach to developing bancassurance products, check out “The Greenfield Field Guide for Insurers: Is Greenfield the Right Approach to Your Digital Transformation?”
