However, the financial supermarkets have more advantages as a customer gets access to several financial services at once – credits, insurance products, money transfers, consultation on legal and other matters.
Types of ‘money’ supermarkets
Financial supermarkets may be divided into three types. The first is holding comprising several daughter companies offering both bank and insurance services under the common trade mark. Such structures, as a rule, are created by the large corporations.
The second type is the free market one. In this case a bank and an insurance company enter an affiliate agreement about combined agent sales of their products.
The third type is the broker one. It implies the presence of broker intermediate organizations that gather information on all financial services, and find an appropriate variant for a customer.
At the present moment, there are two types of supermarkets in Ukraine, and the third one is on the initial stage of development. That’s why the latter is especially interesting. There is an opinion that our country should follow the eastern countries’ way where the spheres of financial services production and their sales are separated. These services are produced by banks and insurers, and are sold by specialized companies – the financial brokers. Such a scheme is profitable for customers, too, as the brokers can find the most optimal variant because they are not structurally tied with any particular bank or insurance companies.
According to the words of the Deputy Director of the work with non-insurance brokers department of Insurance Company ‘Allianz’ Vitaliy Vilinchuk, the joint projects of a bancassurance kind are profitable not only for insurance companies, but also for the banks. The sense of cooperation is in simultaneous sales of bank and insurance products by bank’s employees. ‘The simplest example of such a deal is insuring an apartment when arranging a credit on its purchase,’ – told the expert. ‘The bank charges commission for this work. But this commission is paid not at the cost of rise in cost of a product for a customer, but at the cost of the fact that the company in this way benefits from the sales of policies’. Such joint projects make customer’s life easier as they make the process of arranging both a credit and an insurance more convenient and comfortable. ‘In my opinion, this exact approach to servicing the customer lets the banks attract the new customers and satisfy needs of the patrons’, - noted Mr. Vilinchuk.
Here are the insurance products which may be sold through the bank’s network:
- Compulsory and voluntary insurance of civil liability of transport facilities owners (OSAGO);
- Technical assistance;
- Insurance against accidents, including transport ones;
- Personal insurance;
- Domestic property insurance;
- Voluntary liability before third persons insurance.
Peculiarities of Ukrainian bancassurance
As an example of a financial supermarket we may set a ‘Brokbusinessbank’s’ one, where in one room there are offered not only all kinds of bank services, but also not connected with bank activity ones, such as legal, notarial, audit, consulting, insurance, travel, property services, and even booking and selling the tickets. In particular, the individuals are offered deposits with insurance protection, Western Union money transfers, Visa and MasterCard International plastic cards service, cheque service. ATM works 24h.
There is a financial supermarket in ‘Ukrainskaya finansovaya gruppa’ bank. In this structure, besides the bank services, they realize the whole range of financial, insurance, consulting, legal ones, and also money transfers via Western Union, Anelik, Unistream, ‘Bystrye Den’gi’, PrivatMoney, and others.
UkrSibbank has opened a business center BNP Paribas for financing the international trade operations of its customers. This business center, in the first turn, might be interesting for enterprises involved into foreign-trade operations. In the center a customer is submitted a credit limit which they may use both in Ukraine and abroad.
‘Mega Polis’ financial supermarket is not a branch of some bank any more – it is a broker at the Ukrainian financial market, offering its customers wider right to choose. It is a partner of the leading banks, insurance and legal companies, automobile sales centers of Ukraine.
The bancassurance system is being developed in OTP Bank as well. Its program provides concluding insurance contracts by a bank employee on behalf of ‘Ingo-Ukraine’ stock life insurance company, IC ‘VESKO’, and IC ‘Allianz’. The agreements are such as mortgage insurance, insurance against accidents of a financial borrower, bank pledged transport facilities insurance (by KASKO program).
VAB Bank when founding a financial supermarket chose even simpler way – it created its company – ‘VAB-insurance’. And now it offers private customers all kinds of property insurance, transport insurance (including OSAGO), and also life and health insurance.
Still the main ways of banks and insurers’ cooperation are mortgage and car credits. As these types of crediting require insurance of property or transport which are pledged in a bank.
The foreign financial supermarkets have existed for a long time. In the USA they appeared in early 20-ies of XX century. The most wide-spread financial supermarkets are in France, Great Britain, Spain, Portugal, Italy and Belgium, and also in Switzerland.
Bank insurance in various forms also got some development in the countries of Latin America and Asia, in particular, in Japan and South Korea.
