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

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

  • Published: October 2012
  • Region: Mexico
  • 72 Pages
  • Finaccord

Bancassurance in Mexico: Life, Non-Life and Creditor Insurance is a study and related PartnerBASE™ dataset examining the provision of life, non-life and creditor insurance by banks and other lending institutions in Mexico.

Drawing on the results of a survey of 47 banking entities in Mexico, the study verifies the percentage of organisations investigated that distribute each of the following 13 types of insurance: accident insurance, creditor insurance related to consumer finance, creditor insurance related to credit cards, creditor insurance related to mortgages, critical illness insurance, health / hospital cash plans, household insurance, income protection insurance, investment-related life insurance, medical expenses insurance, personal motor insurance, retirement savings, and risk life insurance.

For those banking entities that are active in one or more of these fields, the reports ascertain the operating models that they use to source the type of insurance in question (e.g. external, joint venture or captive underwriters) and the identity of the specific providers used. This information is then displayed in terms of the weighted share of partnerships of these 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

Bancassurance is one of the most important distribution channels in Mexico

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

PartnerBASE™ and market data annexe

Finaccord

2.0 MARKET BACKGROUND

Banks and other lending institutions covered

Economic background

Mexico is the second-largest economy in Latin America…

…and has enjoyed reasonably strong economic performance in recent years

The service sector accounts for over 70% of GDP

In spite of economic progress, the country faces several major social problems

In the World Bank's Ease of Doing Business Index, Mexico is ranked 53th in the world

Introduction to the banking sector

Banco Azteca leads the market in terms of its outright number of retail customers...

... but not when measured by its share of banking assets

The banking sector is dominated by several foreign-owned entities

A number of banks targeting lower-income customers are affiliated to retailing group

Due to the influence of INFONAVIT, banks account for a limited share of mortgage lending

Introduction to bancassurance

Mexican bancassurance is well-developed, especially for life insurance products

Subsidiaries of the country's large financial groups are prominent in the bancassurance market…

… particularly in the life insurance segment

3.0 INVESTMENT-RELATED LIFE INSURANCE AND RETIREMENT SAVINGS

Insurance market size and growth

Although the market for investment-related life insurance is worth more...

... the market for retirement savings experienced rapid growth between 2008 and 2012

Distribution share of banks

The bank distribution channel accounts for almost a quarter of in-force policies

Bancassurance provision rates, operating models and partnerships

Investment-related life insurance

Only the larger banking organisations offer investment-related life insurance in Mexico

Seguros Banamex is the leading provider by weighted share of partnerships

Zurich and Santander entered into a 25-year strategic distribution arrangement in 2011

26 banking organisations in Mexico do not offer investment-related life insurance

Retirement savings

One out of four banking organisations offers retirement savings…

...and the market is entirely controlled by captive and joint venture providers

In terms of managed retirement accounts, Afore XXI Banorte leads the market

Performance of key bancassurance underwriters

Two of the five largest life insurance providers in Mexico are subsidiaries of banks

Pensiones Banorte Generali and Pensiones BBVA Bancomer are especially strong in the pensions sector

4.0 PROTECTION-RELATED LIFE INSURANCE

Insurance market size and growth

Protection-related life insurance grew at a nominal annual rate of 10% between 2008 and 2012...

... and constitutes a more valuable market in Mexico than investment-related insurance

Distribution share of banks

Bancassurance provision rates, operating models and partnerships

Risk life insurance

Around a half of Mexico's banking institutions promote some form of risk life insurance

Seguros Azteca leads the market in terms of weighted partnership share…

…albeit second-ranked Seguros Banamex is considerably stronger when measured by premiums

Non-captive underwriters active in this market are ACE, Atlas, Argos, AXA, Cardif, MetLife and RSA

Critical illness insurance

Critical illness insurance is less commonly sold through the banking channel…

...although those partnerships in place are very similar to those for risk life insurance

Income protection insurance

Income protection insurance is rarely marketed by banks in Mexico

Performance of key bancassurance underwriters

5.0 ACCIDENT AND HEALTH INSURANCE

Insurance market size and growth

The market for accident and health insurance has experienced reasonable growth in recent years...

... buoyed in part by the popularity of medical expenses insurance

Distribution share of banks

Banks appear to be most effective at selling relatively low-cost policies to individual customers

Bancassurance provision rates, operating models and partnerships

Accident insurance

Around one third of banking organisations investigated in Mexico offer accident insurance

RSA established bancassurance partnerships with both BanBajío and Banca Mifel in 2010

21 banking organisations have no apparent scheme in place for accident insurance

Medical expenses insurance

This form of cover is marketed by a limited number of Mexican banking institutions

Health / hospital cash plans

Health and hospital cash plans are not commonly offered via bancassurance...

... albeit ACE has established distribution ties with both American Express and Credomatic

Performance of key bancassurance underwriters

Bank-owned underwriters control a very significant share of the accident insurance market...

... although they are more peripheral in the health insurance sector

6.0 PERSONAL MOTOR AND HOUSEHOLD INSURANCE

Insurance market size and growth

Household insurance premiums grew at over 19% in nominal terms between 2008 and 2012

Third party motor liability insurance is supposed to be mandatory in Mexico

Distribution share of banks

Compared to many countries, Mexico's banks are reasonably significant as distributors of motor policies

Bancassurance provision rates, operating models and partnerships

Personal motor insurance

Over a half of the banking organisations researched offer personal motor insurance

Among captives and joint ventures, Seguros Inbursa is the largest player in this field

Non-captive underwriters are limited mainly to partnerships with small and medium-sized institutions

Household insurance

The provision rate for household insurance is identical to that for personal motor insurance...

...and the partnerships that exist in both cases are generally similar

Performance of key bancassurance underwriters

Bank-owned underwriters have made steady progress in motor insurance in recent years...

... while their presence in fire insurance has been subject to outwardly dramatic fluctuations

7.0 CREDITOR INSURANCE

Consumer lending market size and growth

Mortgage lending

Mexico's residential mortgage balances grew at a nominal annual rate of 8.0% between 2008 and 2012

Non-mortgage lending

Non-mortgage balances were hit by the financial crisis in 2009 but have since recovered

Credit and other pay later cards

The number of credit cards in circulation declined slightly between 2008 and 2012

Creditor insurance provision rates, operating models and partnerships

Creditor insurance linked to mortgages

Almost all mortgage lenders offer related creditor insurance

Captive and joint venture underwriters dominate the market in terms of weighted partnership shares...

... with Genworth Financial identifiable as the leading non-captive insurer by this measure

Mexico's largest mortgage lender offers an automatic debt guarantee scheme

MAPFRE has concluded a significant new distribution agreement with Genworth Financial

Creditor insurance linked to consumer finance

Loan payment protection insurance is offered by most relevant lending organisations in Mexico…

Six banking organisations have no apparent scheme for in place for this type of creditor insurance

Creditor insurance linked to credit cards

Schemes for credit card payment protection insurance are slightly less common in Mexico...

... albeit they are still fairly numerous when compared to some other countries

Creditor insurance risk coverage

Mexico's creditor insurance market features both basic and fully-fledged payment protection formulae

Creditor insurance market size, growth and forecast

The total market is likely to be worth more than USD 500 million in 2012...

… with decent growth in evidence since 2008

... and with a rapidly-growing middle class expected to boost premiums further up to 2016

LIST OF GRAPHICS / TABLES

0.0 EXECUTIVE SUMMARY

Overview of bancassurance provision rates for different types of insurance in Mexico, 2012

1.0 INTRODUCTION

2.0 MARKET BACKGROUND

Key economic indicators for Mexico, 2012Banks and other lending institutions in Mexico contacted by Finaccord, segmented by type

3.0 INVESTMENT-RELATED LIFE INSURANCE AND RETIREMENT SAVINGS

Gross written premiums for investment-related life insurance and retirement savings in Mexico, 2008 to 2012

Gross written premiums for investment-related life insurance and retirement savings in Mexico, 2008 to 2012 (data)

Bancassurance provision of investment-related life insurance in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of retirement savings in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Market share in total life insurance of key bancassurance underwriters in Mexico, 2007 to 2011

Market share in pensions of key bancassurance underwriters in Mexico, 2007 to 2011

4.0 PROTECTION-RELATED LIFE INSURANCE

Gross written premiums for protection-related life insurance in Mexico, 2008 to 2012

Gross written premiums for protection-related life insurance in Mexico, 2008 to 2012 (data)

Bancassurance provision of risk life insurance in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of critical illness insurance in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of income protection insurance in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

5.0 ACCIDENT AND HEALTH INSURANCE

Gross written premiums for accident and health insurance in Mexico, 2008 to 2012

Gross written premiums for accident and health insurance in Mexico, 2008 to 2012 (data)

Bancassurance provision of accident insurance in Mexico 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of medical expenses insurance in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of health / hospital cash plans in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Market share in accident insurance of key bancassurance underwriters in Mexico, 2007 to 2011

Market share in health insurance of key bancassurance underwriters in Mexico, 2007 to 2011

6.0 PERSONAL MOTOR AND HOUSEHOLD INSURANCE

Gross written premiums for personal motor and household insurance in Mexico, 2007 to 2011

Gross written premiums for personal motor and household insurance in Mexico, 2007 to 2011 (data)

Bancassurance provision of personal motor insurance in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Bancassurance provision of household insurance in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Market share in total motor insurance of key bancassurance underwriters in Mexico, 2007 to 2011

Market share in fire insurance of key bancassurance underwriters in Mexico, 2007 to 2011

7.0 CREDITOR INSURANCE

Residential mortgage lending balances outstanding in Mexico (absolute and per capita), 2008 to 2012

Consumer non-mortgage lending balances outstanding in Mexico (absolute and per capita), 2008 to 2012

Credit and other pay later cards issued and per capita in Mexico, 2008 to 2012

Key data points for the consumer lending market in Mexico, 2008 to 2012

Provision of creditor insurance linked to mortgages in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Provision of creditor insurance linked to consumer finance in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Provision of creditor insurance linked to credit cards in Mexico, 2012: provision rate, operating models and weighted provider share of partnerships

Risk coverage of creditor insurance policies in Mexico, segmented by type of underlying product, 2012

Creditor insurance gross written premiums in Mexico, segmented by policy type, 2008, 2012 and 2016

Creditor insurance gross written premiums in Mexico, segmented by cover type, 2008, 2012 and 2016

Creditor insurance gross written premiums in Mexico, segmented by policy and cover type, 2008, 2012 and 2016 (data)

Note: Product cover images may vary from those shown

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