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Bancassurance in Denmark: Life, Non-Life and Creditor Insurance Product Image

Bancassurance in Denmark: Life, Non-Life and Creditor Insurance

  • Published: November 2011
  • Region: Denmark
  • Finaccord

Finaccord's report titled Bancassurance in Denmark: Life, Non-Life and Creditor Insurance is about the distribution of insurance products through banks and other lending institutions in Denmark. Types of insurance considered are: investment-related life insurance and retirement savings; risk life insurance, critical illness insurance and income protection insurance; accident insurance, medical expenses insurance and health / hospital cash plans; personal motor insurance and household insurance; and creditor insurance for mortgages, consumer finance and credit cards.

Based on a survey of 49 organisations, it identifies 175 bancassurance distribution initiatives across these types of insurance, and highlights the operating models and product providers used in the vast majority of cases. Moreover, it analyses these bancassurance agreements in terms of ‘weighted partnerships' which take into account the size of the retail customer base of the banking institutions distributing these policies, thereby differentiating between the most important relationships and those that are comparatively minor.

In addition, with the exception of creditor insurance, for which historic, READ MORE >

0.0 EXECUTIVE SUMMARY

1.0 INTRODUCTION

What is this report about?

Distribution partnerships with banks and other lending institutions constitute the focus of this report

Rationale

Across Europe, over 80% of banking entities surveyed are active in this arena to one extent or another

Methodology

Survey of banks and other lending institutions

Market data

Definitions

Investment-related life insurance

Retirement savings

Risk life insurance

Critical illness insurance

Income protection insurance

Accident insurance

Health / hospital cash plans

Medical expenses insurance

Personal motor insurance

Household insurance

Creditor insurance

Mortgages, consumer finance and credit cards

Weighted provider share of partnerships

Operating models

Abbreviations and exchange rates

Finaccord

2.0 MARKET ANALYSIS

Banks and other lending institutions covered

Introduction to the banking sector

Seven of the largest ten banking institutions are indigenous to Denmark

The Danish banking sector has changed significantly as a result of the financial crisis...

...and the number of lending institutions is expected to decrease further

However, the four largest Danish banks remain comparatively healthy

Investment-related life insurance and retirement savings

Insurance market size and growth

The popularity of unit-linked policies has underpinned the Danish life insurance and pensions market

Distribution share of banks

Bancassurance provision rates, operating models and partnerships

Investment-related life insurance

Danish banks focus on selling pension products rather than investment-related life insurance...

Retirement savings

Entities with no arrangement in this arena are mainly specialised lenders, rather than banks

PFA benefits from distribution relationships with at least ten sizeable banking institutions

Two important captive underwriters are ranked second and third by weighted share of partnerships

Performance of key bancassurance underwriters

The market share of total life insurance of Danica Pension fell sharply in 2009 and 2010

Protection-related life insurance

Insurance market size and growth

Consistent if modest growth characterises protection-related life insurance in Denmark

Distribution share of banks

Bancassurance provision rates, operating models and partnerships

Risk life insurance

Excluding specialised lenders, most banking entities are active in this field

By weighted share of partnerships, PFA is the market leader...

... followed by NyKredit Livsforsikring and three captive underwriters

PFA has developed an insurance policy with the specific focus of protecting children

Critical illness insurance

The main partnerships are similar to those for risk life insurance

Income protection insurance

The provision rate for this form of cover is almost the same as that for critical illness insurance

In a number of cases, stand-alone unemployment insurance is available

Performance of key bancassurance underwriters

Accident and health insurance

Insurance market size and growth

Denmark's market for accident and health insurance is expanding at a relatively robust pace

Distribution share of banks

Bancassurance provision rates, operating models and partnerships

Accident insurance

Accident insurance is offered by 12 of the 41 banks and other lending institutions investigated

Nordea set up a strategic partnership with Tryg in 2002...

...with Codan having established a distribution relationship with local saving banks two years previously

Only two captive underwriters are active in this segment

Medical expenses insurance

Medical expenses policies are offered by relatively few banks in Denmark...

Health / hospital cash plans

... and health / hospital cash plans by even fewer

Performance of key bancassurance underwriters

The two underwriters with a close focus on the bank distribution channel are relatively minor players

Personal motor and household insurance

Insurance market size and growth

Denmark's market for household insurance has expanded at a comparatively rapid rate in recent years

Distribution share of banks

Bancassurance provision rates, operating models and partnerships

Personal motor insurance

A significant proportion of banking entities have an arrangement in place for motor insurance

Smaller deals are held by a range of other captive and non-captive underwriters

Household insurance

The main partnerships in this market were found to be fairly similar to those for personal motor insurance...

... albeit Privatsikring picks up an extra deal (with Ringkjøbing Landbobank)

A number of quite significant banking institutions have no arrangement in place for household insurance

Performance of key bancassurance underwriters

Creditor insurance

Consumer lending market size and growth

Mortgage lending

Mortgage lending balances grew at an annual average of 5.2% between 2006 and 2010

Non-mortgage lending

Danish consumers have cut back on their non-mortgage lending since 2008

Credit and other pay later cards

Credit and other pay later cards issued grew at an annual average of almost 10% between 2006 and 2010

Creditor insurance provision rates, operating models and partnerships

Creditor insurance linked to mortgages

All but two mortgage lenders are also active in mortgage-related creditor insurance

Letpension and PFA entered into a distribution agreement in 2010

Four captive underwriters were found to be active in this bancassurance sector

ALKA benefits in this sphere from a relationship with Arbejdernes Landsbank

The offering of one bank is for stand-alone unemployment insurance only

Creditor insurance linked to consumer finance

Over two thirds of institutions offering consumer finance also offer a related creditor insurance policy

Counting both captives and non-captives, around a dozen underwriters are active in this market

Creditor insurance linked to credit cards

Five underwriters account for ten schemes in Danish credit card payment protection insurance

Creditor insurance risk coverage

Policies sold to credit card customers are most likely to cover temporary incapacity and unemployment

Alternative distribution channels

Creditor insurance market size, growth and forecast

Up to 2015, growth is expected to be strongest for credit card payment protection insurance

LIST OF GRAPHICS / TABLES

0.0 EXECUTIVE SUMMARY

Overview of bancassurance provision rates for different types of insurance in Denmark, 2011

1.0 INTRODUCTION

Banks and other lending institutions in Denmark contacted by Finaccord, segmented by type

2.0 MARKET ANALYSIS

Gross written premiums for investment-related life insurance and retirement savings in Denmark, 2006-2010

Gross written premiums for investment-related life insurance and retirement savings in Denmark, 2006-2010 (data)

Bancassurance provision of investment-related life insurance in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of retirement savings in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Market share in total life insurance of key bancassurance underwriters in Denmark, 2006-2010 (data)

Gross written premiums for protection-related life insurance in Denmark, 2006-2010

Gross written premiums for protection-related life insurance in Denmark, 2006-2010 (data)

Bancassurance provision of risk life insurance in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of critical illness insurance in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of income protection insurance in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Gross written premiums for accident and health insurance in Denmark, 2006-2010

Gross written premiums for accident and health insurance in Denmark, 2006-2010 (data)

Bancassurance provision of accident insurance in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of medical expenses insurance in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of health / hospital cash plans in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Market share in total non-life insurance of key bancassurance underwriters in Denmark, 2006-2010 (data)

Gross written premiums for personal motor and household insurance in Denmark, 2006-2010

Gross written premiums for personal motor and household insurance in Denmark, 2006-2010 (data)

Bancassurance provision of personal motor insurance in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of household insurance in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Residential mortgage lending balances outstanding in Denmark (absolute and per capita), 2006-2010

Consumer non-mortgage lending balances outstanding in Denmark (absolute and per capita), 2006-2010

Credit and other pay later cards issued and per capita in Denmark, 2006-2010

Key data points for the consumer lending market in Denmark, 2006-2010

Provision of creditor insurance linked to mortgages in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Provision of creditor insurance linked to consumer finance in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Provision of creditor insurance linked to credit cards in Denmark, 2011: provision rate, operating models and weighted provider share of partnerships

Risk coverage of creditor insurance policies in Denmark, segmented by type of underlying product, 2011

Creditor insurance gross written premiums in Denmark, segmented by policy type, 2007, 2011 and 2015 (forecast)

Creditor insurance gross written premiums in Denmark, segmented by cover type, 2007, 2011 and 2015 (forecast)

Creditor insurance gross written premiums in Denmark segmented by policy and cover type, 2007, 2011 and 2015 (forecast) (data)

Note: Product cover images may vary from those shown

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