After Max Life tie-up with HDFC; Axis Bank strengthens its bancassurance with LIC
First it was Max Financial Services collaborating with HDFC Standard Life Insurance Company. Now, Axis Bank has entered the ring with its tie-up with the Life Insurance Corporation of India (LIC).
India's third largest private sector bank, Axis Bank, and India's largest insurance company, LIC has tied-up where the former will sell the latter's policies through its banking channels.
“The coming together of the two major reputed organisations would enable them to combine and utilise the synergies for enhancing customer satisfaction and for serving social objectives of the nation, ” says Mukesh Gupta, Executive Director, Bancassurance , LIC.
Rajiv Anand, Executive Director & Head Retail Banking, Axis Bank, added, “Banks have increased their role in Insurance distribution with Bancassurance being the biggest contributor. Over the last five years the Life Insurance business at Axis Bank has grown at a CAGR of over 25%. The partnership with LIC would enable us to further expand our existing bouquet of offerings and put forth a compelling proposition for our customers.”
In the introductory phase, the bank is expected to distribute LIC’s life insurance products across its branches in West Bengal, Bangalore and Haryana – Panchkula. Further, the bank will also provide post sales services such as premium collection and renewal of policies.
With its 3,006 domestic branches (including extension counters) and 12,871 ATMs across the country, as on 30th June 2016, the network of Axis Bank spreads across 1,855 centres, enabling the Bank to reach out to a large cross-section of customers with an array of products and services.
The deal would be one of the largest Bancassurance partnerships after the recent IRDA (Insurance Regulatory and Development Authority of India ) regulations issued on open architecture framework for banks, said in its press release.
A similar deal was struck between Max Financial and HDFC Standard which got the board approvals on June 17.
Interestingly, Axis Bank has a nearly 6% stake in Max Life.
A memorandum of understanding has been signed stating that Axis Bank branches will be selling LIC’s policies to its customers.
As on March 2016, the market share of LIC in First year Premium (FYP) was 70.44 % and similarly, in Number of Policies it stood at 76.84 % in the same period.