Kattiya Indaravijaya, president of KBank, said that the Office of Insurance Commission (OIC) wants banks to educate customers about insurance products that are not deposit products.
Kattiya said KBank aims to attract middle-income workers who are earning between Bt15,000 and Bt30,000 a month. As a result, KBank’s back-office processes must be adjusted and employees trained to comply with the business plan.
She said that middle-income earners currently represent only 10 per cent of Kbank’s insurance customers due to its earlier focus on upper-income customers, people who earn at least Bt50,000 a month.
She said that the bank intends to put much more effort into educating its employees about the importance of insurance to meet the requirements of the lower segment.
The bank has to adjust how its employees sell insurance plans, she added
Most upper-income customers already have insurance plans, and KBank will use data analytics to highlight those that should not be offered insurance products. Data analytics will also be used to match middle-income earners who do not have insurance with an insurance product, which the bank says can be used as a tax deduction.
Kattiya said the current low interest rates may be making insurance less attractive and as such the fee income from bancassurance in 2017 is projected to grow only 4 per cent from double digits this year.
Noppawan Jermhansa, Kbank executive vice president, said that bank’s research revealed that there is demand for insurance products from middle-income earners but they don’t know what kind of protection plan they need to match their requirements. The bank, therefore, has to make it clear which packages comply with customers’ need.
She said that the growth in premiums in 2017 is projected to expand by 4 per cent in line with the expected fee-income growth.