Unlocking Growth Through Tailored Insurance for Loan and Retail Customers

The Strategic Role of New Product Innovation in Bancassurance

As Southeast Asia's insurance market surges toward a projected $114 billion in gross written premium (GWP) within four years, banks and insurers must sharpen their focus on customer-centric insurance product design—especially for loan customers and mass-retail segments. The era of generic insurance offerings is over; to succeed, institutions must create targeted life, health, and savings products that align with everyday financial touchpoints.

Bancassurance must shift from passive distribution to life-event-aligned solutions. By embedding life insurance in loan products and tailoring health and savings options to retail behaviors, banks and insurers will build deeper engagement and unlock new revenue growth—while fulfilling their duty to protect customers.

1. Life Insurance for Loan Customers: A Natural Fit

Loan customers, particularly those financing homes, cars, or personal expenditures, present a natural demand for life protection. These customers already exhibit a clear financial footprint and a need to manage long-term risk.

• Embedded Insurance Opportunity: As the BCG paper notes, banks know when a customer takes out a loan and when motor insurance is due. By embedding credit-linked life insurance at the point of loan disbursement, banks can protect both the customer’s liability and their family’s future financial security.
• Trust & Convenience: With 62% banking penetration in SEA and growing, the trust in banks as financial partners enables seamless uptake of these policies.
• Revenue Upside: Credit-linked life products are high-margin, low-cost to distribute through existing loan workflows, boosting non-interest income.

2. Health and Protection Products for Mass-Retail Customers

Mass-market retail clients often remain underinsured, particularly in health protection, due to limited exposure and product complexity. But that’s changing.

• Simple Health Insurance: Banks can drive penetration by offering easy-to-understand hospital cash, critical illness, or family protection plans. Training frontline staff and integrating sales into bank apps can increase conversions.
• Branch Enablement Wins: BCG highlights that frontline training and RM incentives have boosted new business by 20–40% and productivity by 20–25% in select SEA programs.
• Financial Wellness Integration: Banks should position health protection as a part of holistic financial well-being—particularly effective for customers making medical payments or showing healthcare-related spending.

3. Multi-Goal Savings Products for All Segments

Retail clients have evolving goals: education, retirement, travel. Banks are uniquely positioned to offer goal-based savings insurance products that combine protection and investment.

• These products are easier for RMs to explain and sell, especially when customer data (like transaction history or savings patterns) is used to personalize the pitch.
• D2C Channels: Embedding savings-linked insurance into digital onboarding journeys ensures visibility to customers who prefer mobile-first banking.

The topics add some points to consider in Myanmar markets;

Myanmar’s banking sector has made steady progress in expanding access and financial literacy. With rising bank account ownership and stronger digital awareness, the next frontier is bancassurance—especially in providing life and health insurance to customers taking loans or managing household finances.

Banks in Myanmar are now reaching more customers in both urban and rural areas. Many of these customers are taking loans for small businesses, agriculture, or family needs—but few are protected if the unexpected happens. Life insurance can safeguard their families, protect loan repayments, and bring peace of mind.

Meanwhile, health risks remain one of the biggest financial shocks for ordinary Myanmar households. Simple, affordable health insurance products can play a vital role—especially when bundled with savings accounts or retail services.

 What Banks and Insurers Can Do:

• Offer life insurance protection tied to personal or MSME loans
• Introduce basic health policies at branch and agent level for walk-in customers
• Use customer behavior (e.g., cash flow, clinic payments) to trigger insurance conversations
• Provide branch staff with training and digital tools to support in-person sales

Branch enablement programs in similar SEA countries have shown up to 40% increases in new insurance sales and higher customer satisfaction.

Myanmar's financial system is growing—and so is its customer base. If we integrate life and health insurance into everyday banking, we create a win-win: banks get diversified income, and customers gain financial protection.

Title: Unlocking Growth Through Tailored Insurance for Loan and Retail Customers

Reference:

·        Mazón, S., Tang, T., Brenchley, P., Schmidt-Jochmann, C., & Ne Win, A. (2024, May). Bancassurance in Southeast Asia: A $114 billion opportunity. Boston Consulting Group. https://www.bcg.com

#Bancassurance #MyanmarBanking #LifeInsurance #HealthInsurance #FinancialInclusion #CustomerProtection