Royal Sundaram, Lakshmi Vilas Bank in bancassurance tie-up
Our Banking Bureau
31 October 2003
Royal Sundaram will distribute personal and commercial insurance products across the bank's 221-branch network in a phased manner. To begin with, LVB's borrower customers will be able to purchase Royal Sundaram's insurance policies through the bank's branches.
Says LVB chairman A Krishnamoorthy: "This bancassurance tie-up with Royal Sundaram for distributing non-life insurance products will leverage our branch network infrastructure mostly concentrated in South India by cross-selling the insurance products with bank deposits and loan schemes. At the outset, the bank will concentrate on insuring assets of over 2 lakh existing and prospective borrower customers."
"The bank plans to have a team of dedicated insurance relationship officers who will be trained on the various non-life insurance products and claims settlement procedures," he adds. "Insurance Regulatory Development Authority's corporate agency licence for marketing Royal Sundaram's products without risk participation or underwriting from the bank side will be obtained soon.
Royal Sundaram will look to develop a range of insurance products and services for LVB customers with a particular focus on the small-business segment. This has been a major area of growth for LVB and Royal Sundaram's specially designed Enterprise suite of products covering offices, shops, dealers/distributors and retailers, hotels, manufacturing industry, motor dealers, educational institutions and property owners offers an opportunity for both companies to develop the business to their mutual benefit.
Says Royal Sundaram managing director Micky Brigg: "Bancassurance partnerships contribute meaningfully to our commitment of being a pan-Indian player. We see banks like LVB as an important partner in the unfolding Indian insurance sector. They enable an insurer to reach into those parts of the country, where both geographically and otherwise it may not be possible for the insurer to extend its presence. Through this relationship, we will be able to distribute our rural insurance packages across the vast markets of South India. This reinforces our focus on improving insurance penetration beyond the urban and semi-urban communities."