The most direct advantage for customers is that, in insurance business the question of trust plays a greater role, especially due to the basic requirement of a long term relationship between the insurer and the insured. In India, for decades, customers were used to the monopolistic approach of public sector insurance companies, in spite of there were many drawbacks in their dealing, they enjoyed customer confidence, this trend continues even now mostly due to their Government ownership. The customers who want to move over to private insurance companies that are collaborated with foreign companies which are less identified to the Indian public would take little more time. The void between the less identified newer private insurance companies and the prospective insured could be comfortably filled by the banks because of their sound established and long cherished relationship. Under these circumstances, any new insurance products routed through the bancassurance channel would be well received by the customers. Above all, in the emerging scenario, customers desire to have a consolidation and delivery of all financial services at a solitary window in the form of ‘financial super market’, irrespective of whether financial or banking transactions, because such accessibility of wide range of financial/ banking services and products relieves the customers from the particular efforts of scouting for a separate dealer for each service/ product. Even internationally, the trend is towards the ‘one-stop-shop’. Customers could also get a share in the cost savings in the form of reduced premium rate because of economies of scope, besides getting better financial analysis at single point. Even in the case of developed countries the financial literacy and financial analysis has been increasingly stressed in recent years, these become essential especially when assessment involves long term investments. In India, recently Reddy (2006) has been emphasizing on the value and necessity for financial counseling and financial literature. In that context too the bankers are better placed in extending such analysis or financial advisers to the customer because of their well established long cherished relationship. The relationship between insurer and insured and bank and its client are different, the former involves taking decisions for long term parting of money, in such cases counseling is necessary, here too the bancassurance can be of reassuring for the customer.
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