bancassurance in china - boston consulting group

December 2009

Reaching the Next Level

Bancassurance in China

Chris Kaye (BCG), Frankie Leung (BCG), Holger Michaelis (BCG), Chee Kok Poh (Swiss Re), Eric Schuh (Swiss Re), and Robert Wiest (Swiss Re)

Contents

Preface 1

ExecutiveSummary 2

ABriefIntroductiontoChina’sInsuranceMarket 3Overview 3Bancassurance in China—A Story of Explosive Growth 4

TheNextWaveofGrowth 5The “Many-to-Many” Model: An Imbalance of Power 5The Need for Product and Service Innovation 6The Way Forward: Integration and Exclusivity 7Regulatory Reform: A Transition Already Underway 8

SuccessfulPathwaystoaWinningBancassuranceModel 9The Opportunity 9A Win-Win Approach 9Different Models Work for Different Players 10The 10 Building Blocks of a Successful Bancassurance Model 12

ACalltoAction 15

DECEMBER 2009THE BOSTON CONSULTING GROUP • Swiss Re

Preface

China’sbancassurancemarketisgrowingatbreathtakingspeed.Atthesametime,itappearstobelockedinaparadox.BanksarealreadythedominantsaleschannelforlifeinsuranceinChina,andarepropellingthecountry’srapidgrowthinpremiumvolume.However,thebreadthandsophisticationofcurrentlyavailableproducts—aswelltheoverallqualityofcustomerservice—lagfarbehindbancassuranceactivitiesinmanyothercountries.Theresultisarapidlydeveloping,yetunusuallyunderdevelopedmarket.

Severalfactorshavecontributedtothepresentsituation.First,banksobviouslyhaveconsiderablemarketingpower inthefinancialservicesarena.Theyalsoarepermittedtosellmultiplebrandsof insurance—althoughtheyarenotyetallowedtoowninsurersoutright.Theresultingmodelisoneinwhichbanksoftensellrelativelyunsophisticatedsavings-typeproducts—offeringsthatcarryavarietyofbrandnames—inanuntargetedway.Wecallthisstructure“many-to-many.”

Why,then,don’tinsurersdevelopbetter-tailoredproductsandserviceforthebankchannel?First,thereislittleincentiveforinsurerstotrainbankingstaffsinproductdetailandadvancedsalestechniqueswhenthisexpertisewillbeused,atleastinpart,toselltheircompetitors’products.Inaddition,insurersalreadypaygenerouscommissionstobanksfor“shelfspace,”hurtingtheirownprofitabilityandabilitytoinvestininnovation.

There is,however,agrowingrecognitionthatthepresentmarketstructure isnotsustainable. Indeed,Chineseregulatorsarealreadyworkingonbancassurancereforminordertopromotebetterintegrationofbanksandinsurers.WebelievethatthisinitiativewillpushChina’smarketinthedirectionofmorematurebancassurancemarkets.Morespecifically,wearelikelytoseeaperiodofheavyinvestmentinproductdevelopment,marketing,customerservice,andplatformsynergy.Theinsurersandbanksthatareleadingthispushwillbeinapositiontobuildsignificantcompetitiveadvantageinthemarket.Theprerequisiteforsuccess,however,willbetheformingofexclusivepartnerships—ofvariousnatures—sothatinvestmentsofcapitalandknow-howcanbeprotectedandgeneratepositiveresults.

Banksandinsurersalikewillneedtothinkthroughthedifferentoptionsavailabletothem—takingtheirspecificcapitalresourcesanddistributionnetworksintoaccount—andadoptastrategythatisalignedwiththeirlong-termaspirations.Bettingontherightstrategicoptionnowandensuringbest-in-classexecutioncanresultinextraordinarybenefits.

Reaching the Next Level

Bancassurance in China

DECEMBER 2009 THE BOSTON CONSULTING GROUP • Swiss Re

Bancassurance in China2

Executive Summary

◊BancassurancehasalreadyemergedasChina’sbiggestplatformforlifeinsurancesales,yetitcurrentlyoperatesona“many-to-many”distributionmodel.Thismodelhasbeenfacilitatedbyregulationsthatallowbankstoselltheproductsofmultipleinsurerssidebyside.

◊ Inthelongrun,themany-to-manymodelisnotsustainable.SimpleanalysisofoperatingprofitssuggeststhatbancassurancedoesnotcreatesignificantvalueforinsurersinChinatoday.Ingivingbanksmoreleverageovertheinsurerswhoseproductstheysell,themany-to-manymodelfailstoincentivizeproduct,marketing,orservice innovationamonginsurers.Bankshavelittlemotivationtochangethissystembecauseitprovidesthemwithhandsomecommissions.

◊Thelackofproductdiversityandsalesknow-howresultingfromthecurrentsystemisstartingtoimpactdemandforinsuranceproductssoldthroughbanks.Withoverallpenetrationstilllow,however,bothlifeandnon-lifeinsurancepremiumsinChinashouldcontinuetogrowannuallybydoubledigits,supportedbybroadermacrotrends.Still,althoughthesizeandwealthoftherelevantbuyergroupwillcontinuetomushroom,thegrowthofbancassurerswillbeweakenediftheyareunabletotakealargershareofwalletfromincreasinglysophisticatedanddemandingcustomers.Otherinsurancedistributors,suchasagentsandbrokers,mightwinbackmarketsharesoncelosttobanks.

◊ Inordertoremaincompetitive,bancassurerswillhavetowidenandupgradetheirproduct linesandimprovetheircustomerservicemodels—inessence,givingcustomersmoreandbetterproductsinamoretargeted,service-orientedwayinordertocreatebrandloyalty.Thiswillrequiresubstantialinvestment.

◊Banksandinsurerswillalsohavetoforgemoreexclusiveandbetterintegratedpartnershipsinordertojustifytheseinvestments.Therearefourbancassurancepartnershipmodelsthat,dependingoneachparty’sneeds,haveproventobesuccessful:exclusivedistributionpartnership; jointventure;financialholdingcompany;andintegratedlineofbusiness(whichtakesanorganizationalratherthanlegal-entitypointofview).

◊Sharpexecutionofthesepartnerships—whosescopecanvaryfromregionaltonationalandfromsingle-tomulti-product—iscritical. Inparticular,partnerswillneedtofocusoninitiativesthatformthe10buildingblocksofasuccessfulbancassurancemodel:developproducts jointly;streamlineproducts;adoptageneralistsalesmodel;createmeaningfulsalestargetsandincentives;bundleproductsforlifeevents;trainrigorously;upgradeITsystems;defineorganizationalroles;bolstercustomerserviceandpost-salesupport;andensurecapitalandriskmanagement.

◊ Insum,webelievethatthemarket-sharelandgrabchapterofChina’sbancassurancesagaisnearinganend.Winning intheemergingcompetitivephasewillrequirequantumimprovements inproductinnovationandintheintegrationofmarketinganddistribution.Allofthesegoalscanbeachievedonlythroughtheintroductionofmore,deeper,more-exclusive,longer-termpartnershipsbetweenbanksandinsurers.


Bancassurance in China 3

A Brief Introduction to China’s Insurance Market

Overview

China’sinsuranceindustryisstillyoung—anditisbooming.Thecountry’s$108.7billioninlifeinsurancepremiumsin2008representednearlyatwelve-foldincreaseoverthe1998level.1In2010, life insurancepremiumsinChinacouldwellexceed$150billion, leavingGermany,currentlyrankedfifthworldwideintermsof lifepremiums,farbehind.China’snon-lifesector isalsopoisedforstronggrowth.Non-lifepremiums,forthefirsttime,exceeded$30billionin2008.

Inpercentageterms,China’s insurance industryhasexpandedrapidlyover thepastdecade,with lifepremiumsgrowingatabout28percentannuallyandnon-lifepremiumsincreasingatroughly20percentannually.Comparedwithotherglobalmarkets,however,penetrationasapercentageofGDPremainsrelativelylow.Forinstance,inAsia,theinsurancemarketsinMalaysia,Thailand,HongKongandTaiwanallhavehigherpenetrationrates.(SeeExhibit1.)ThisunderscoresthegrowthpotentialthatthehighlypopulousChinesemarketholds.

Thispotentialissupportedbyextremelyattractivefundamentals.Onthedemandside,overallwealthinChinaisincreasing.Household-savingsrates,ataround35percentofincome,areimpressivelyhigh.Retaildeposits,around$3.3trillionattheendof2008,representroughlyseventimesthetotalassetsofChineseinsurersand20timesthose insurers’bankdeposits. Inaddition,theChinesepopulationisageingandinvestmentoptionsinthecountryarestilllimited.

Exhibit 1. China’s Insurance Market Still Offers Tremendous Growth Potential

VietnamPhilippines

Indonesia

Japan

China

Taiwan

S.KoreaHK

Singapore Australia

New ZealandIndiaMalaysia

Thailand

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

Tota

l pen

etra

tion

(in p

erce

ntag

e of

GD

P)

Developing markets

Markets with relatively low penetration

Mature markets

1,0000 4,000 5,0001,500500 4500

GDP 2008 (in USD billion)

1.AllcurrencyreferenceshavebeenconvertedtoUSData$1=RMB6.85exchangerate.


Meanwhile,supplyisexpandingfast,causingrapidproliferationofnewsaleschannelsandaratchetingupofmarketingefforts.Atthesametime,regulatorshavestartedtoconsiderfinancialintegrationmoreseriously;forexample,bankshaverecentlybeenallowedtobuystakesininsurancecompanies.

Bancassurance in China—A Story of Explosive Growth

Thepracticeofsellinginsurancethroughbanks—knownasbancassurance—hasgrownataparticularlybriskpaceinChinainrecentyears.In2002,bancassurancepremiumsamountedtojust$730million.Butaftera2003insuranceregulationstipulatedthatbankswerenolongerlimitedtorepresentingjustoneinsurancefirm,premiumsstartedtoexplode,reaching$11billionin2004.In2008,Chinesebancassurerssold$52billioninlifepremiums,about48percentoftotallifepremiumsinthecountry.Today,banksandinsurersarestartingtodevelopfar-reachingstrategicmovesinthissector.

InacountryasvastanddiverseasChina, it ishardlysurprisingthatbancassurancehastakenholdsoquickly.Banks,withtensofthousandsofbranches,provideconvenientsalesplatformsthatreachintoeverycornerofeveryprovince.Throughthesebranches,insurerscanleveragethebrandreputationsofbankstogainfootholdsinnewmarkets.Also,bycooperatingwithbanks,insurersgainaccesstoavastcustomerbasewithstrongpotentialinterestininsuranceproducts—especiallythosedesignedtoreplacebankdeposits.Inaddition,settingupbancassuranceasadistributionchannelisinitiallyrelativelyinexpensiveforinsurers,especiallywhencomparedtothecostsofbuildingupandmaintainingtheirownagencies.

Thecurrentsystemalsoallowsbanks tobroadentheiroverallproductoffering,strengthencustomerloyalty,andaddmorefeestotheirotherwiseinterest-rate-dominatedrevenuemix.Indeed,bancassurancegeneratedaround$1.5billionincommissionincomeforChinesebanksin2008.

WhenitcomestothecurrentbancassurancelandscapeinChina,theinsurersidehasfairlyhighmarketconcentration.Thetoptwolifeplayers inthisarena—ChinaLifeandNewChinaLife—heldabout50percentofthemarket in2008.Thesegiants,alongwithfiveother institutions,accountedfornearly90percentofthemarketin2008.(SeeExhibit2.)

Thisisnottoimplythatthebancassurancemodelisnotprevalentamongsmallerindustryplayersaswell.Infact,mostsmallandmedium-sizedinsurancecompaniesrelyheavilyonbankchannelsandonsavings-typeproducts.Consequently, inthefirsthalfof2009,bancassurancesalesstillaccountedfornearly40percentoftotalpremiumsinChinadespiteageneraltrendtowardfewersavings-typeproducts(resultingfromtheglobaldownturnofinvestmentmarkets).

Infact,virtuallyeveryChinesebankhasbeensellinginsuranceproductsoncommissionforatleastseveralyears,somestartingasearlyas2000.Theregulatorychange in2003thatenabledbankstorepresentmultipleinsurersallowedthe“many-to-many”modeltoarise,andtheresulthasbeenajumbleofproductsandbrandsbeingofferedinbankoutlets.Forinstance,theproductsofthetoptwoinsurersaresoldbynineofthetoptenChinesebanks.Ontheflipside,thetwolargestlendersbothselltheproductsof12ofthetop15insurersinChina,includingthoseofallofthetopsixproviders.

Tofurthercomplicatethepicture,themixofinsurancebrandsofferedatanyonebanktendstodifferfromprovincetoprovince.Negotiationsoverwhichbrandstocarryoftenoccuratthebranchlevel, leadingtopotentiallyinefficient—andinsomecasesdicey—businesspracticeswhensecuringdistributiondeals.

Ultimately,althoughthemany-to-manyarrangementhaspavedthewayformomentousgrowthinthepastfewyears, ithasalsobroughttheChinesebancassurancemarkettoitscurrentimpasse.Simplyput,the



Exhibit 2. China’s Life Bancassurance Market Is Highly Concentrated

1415

33343839

140

0

50

100

150

Bn RMB

China Life New China Life

Taikang Life CPIC Life PICC1 Ping An Life Taiping Life

Gross written premiums through banks 2008

Source: China Insurance Yearbook 2009.1PICC Life and PICC Health.

Marketshare(%)

39.5 10.9 10.6 9.6 9.3 4.2 3.8

necessaryinvestmentsbytruebancassurancepartnershipsintobetterproductsandservicethatwillleadtoprofitable,sustainablegrowthinthefuturearenotyetbeingmade.

The Next Wave of Growth

The “Many-to-Many” Model: An Imbalance of Power

SimpleanalysisofoperatingprofitssuggeststhatbancassurancedoesnotcreatesignificantvalueforinsurersinChinatoday,largelybecauseofthemostlysimple,low-marginproductssoldthroughbanks.Also,insurerslackbargainingpowervis-à-visbanks—which,inturn,benefitdisproportionatelyfromthesystem.

Indeed,withinsurerscompetingagainsteachotherondistributioncommissions,banksareabletoenjoyarelativelylargesliceofthepie.Notsurprisingly,whilebancassurancepremiumsrepresentanever-largershareoftotalpremiums,operating-profitmarginsforinsurersmayactuallybefalling.Insurershavehadfewchoices,however,giventhesystem.Moreover,thosethathavenotestablishedawidemarketpresencethroughrelationshipswithdifferentbanksmayhavemissedoutonthecurrentland-grabphaseofmarketdevelopment,whichisalreadywindingdown.

These imbalancedconditionsbetween insurersandbanksmayhavespurred therapidexpansionoftheChinesebancassurancedistributionmodel,but theyhavealsohinderedthedevelopmentofmore



sophisticatedbancassurancemodels.Ifthisinequalityisnotatleastpartlybalanced,insurers,customers,andfinallybanksaswellwillincreasinglysufferfromaviciouscycleofsluggishproductdevelopmentandweakinnovation.Otherdistributionchannelsmightridehigheronthenextgrowthwaveifbancassurerscontinuetomisscrucialopportunitiestomeettheirclients’true,andevolvinginsuranceneeds.

The Need for Product and Service Innovation

Againstthisbackdrop,majoryetuntappedsourcesofgrowthwillbethebroadeningofproductofferings,the improvementof financialadvice,and thedevelopmentofmore (andbetter)peripheral services.Moreover, thepotential forgrowthandinnovationisobviouswhenviewingChinanexttomanyothermarkets.Forexample,thebreadthofbancassuranceproductsavailableinChinaisfarnarrowerthanthatinSpain—whichdespitebeingfarlesspopulousisoneoftheworld’smostrobustbancassurancemarkets.(SeeExhibit3.)

Mostproducts sold throughChina’sbancassuranceplatformsarebynaturesavingsproducts.A fewstandaloneprotectionproductsaresold,butvirtuallynohealthorpensioninsuranceisavailableviabanks.Similarly,Chinesebancassurersdistributeveryfewtypesofnon-lifeproducts.Thosethatareavailable—motor,property,andcreditorprotection,forexample—aresoldinminisculevolumes.What’smore,thefocus isentirelyonindividual lines.Truth is, theproductrangeofferedintheChinesebancassurancemarketisstilldwarfedbythewhitespace.

Thestoryontheservicessideissimilar.Sincethesamebankstaffsellmultipleinsurancebrands,insurershavelittleincentivetotrainthemeitherinsalesmanshiporinpost-salecustomerservice.Bothelements,

Exhibit 3. The Chinese Bancassurance Market Is Far Less Evolved Than the Spanish Market

Life (savings-oriented)

Agricultural

Loans unemployment

Fleet insurance

Individual pensions

Group life

Disability & long-term careCritical illness

Mortgages (death & disability)

Creditprotection

insurance (CPI)

Non-Life

Life & Health

Product line

Household Motor own damageMotor third party liabilityMortgage endowment

Private health

Personal accident

Life (protection-oriented)

Loans deathSimple covers (Term, PD)

ChinaSpainProduct

= Virtually unknown = Pioneer providers = More widely available = Standard o�ering



however,areessentialforpromotingmore-sophisticatedproducts.Moreover,forbankstomeaningfullyengageinpost-saleservice,theywouldhavetoreducethevarietyandchoiceofbrandnamestheyoffer,potentiallyunderminingtheperceivedcompetitivenessoftheirproductportfolio.

Anecdotally,therateofmis-sellingofproductsisfairlyhighinChina.Forinstance,lifeinsuranceplansareoftensoldasadd-onstolargerwealth-managementproductsthataredesignedbybanks.Customersoftenreceiveminimalinstructionontheinsuranceproduct,andinmanycasesdonotevenunderstandwhatitis.Thistrendhasgivenrisetocomplaintsaboutmis-soldproductsandpoorcustomerservice,leavingsomecustomerssuspiciousofbothbanksandinsurers.

For two industriesbasedontrust, this isworrying tosay the least.Yet thestatusquothatwesee inChina’sbancassurancemarketis,toalargedegree,self-perpetuating.Justastheproliferationofmore-complex, targetedproducts isheldbackbybankingstaff’s lackofproductunderstandingandunevencustomerservice,demandiscurbedby limitedconsumerawarenessand lukewarmconfidence intheproducts.

Yethere lies theopportunity.Bancassurers thatpossessboth targetedproductofferingsandaclearwayofexplainingandmarketingthemwillbeable,inessence,toteachcustomerswhattheydonotyetrealizetheyneed.Orinmoreformalterms,firstmoversinproductinnovationandinthedevelopmentofcomprehensivecustomer-supportserviceswillhaveanopportunity—possiblyagoldenopportunity—toinfluencelong-termpurchasingbehaviorandcatalyzebrandloyaltyinarelativelynascentmarket.

Ultimately,bancassurersandbancassurancepartnershipsthatcanrepositionthemselves inawaythatallowsthembothtodifferentiateandsignificantlyupgradetheirproductsandserviceswillcapturealargershareofcustomerwalletandgetaheadstartonestablishingtruecompetitiveadvantageforthefuture.

The Way Forward: Integration and Exclusivity

Ifmore-complex, sophisticatedproductsare tobe successful, theymustbe reliable—delivering tocustomersexactlywhatispromised.Makingthemthiswaywillrequiremorerigorousproduct-developmentprocessesaswellashigherdegreesof integrationandexclusivity inrelationshipsbetweeninsurersandbanks.Indeed,thecurrentlackofexclusivitygoesalongwaytowardexplainingtoday’sstatusquo.

Just lookatEuropeanbancassurancemarketscomparedto theChinesemarket.Europe ishometoadiversecastofcooperativemodels,noneofwhichresembleChina’smany-to-manymodel.Infact,manyEuropeanmarketssawtheirpenetrationpeakaround2000,atwhichpointtheengineoffurthergrowthhadtobecomemoretailored.Productofferingswerewidened,andexclusivepartnershipsbetweenbanksandinsurerswereforged.Obviously,thishasnotyetbeenthecaseinChina.

Ofcourse,exclusivepartnershipsaresustainableonlyiftheybenefitbothsides.WhilemanyinsurersinChinahavelearnedthatthebankplatformoffersthemquickaccesstoalargecustomerbaseatreasonableinitialcost,Chinesebanksmustrealize—farmorethantheyalreadyhave—thatincreasingtheirshareofwalletandbuildingcustomerloyaltyalsodependsonthegrowthoftheirtotalfinancial-servicesoffering.Insurancewillremainafast-growingsector inChina’seconomyforyearstocome.Butbancassurancepremiumswillgrowatacorrespondingpaceonly ifpenetration isnotheldbackbyafee-driven,sub-parproductandserviceoffering.IfbancassuranceistothriveandreachitspromiseinChina,banksandinsurerswillhavetoachievefurtherintegration,forgingexclusivepartnershipsthataremutuallybeneficialandthatsteertheindustryawayfromthecurrentmany-to-manymodel.



Regulatory Reform: A Transition Already Underway

AlthoughwhollyexclusivebancassurancepartnershipshavenotyetappearedinChina,theemergenceofsomeintegratedfinancialgroupsrepresentsastepintherightdirection.Mostofthisincipientcooperationhascomeaboutthroughregulatoryreformcreatedbythetworelevantgovernmentbodies—theChinaInsuranceRegulatoryCommission(CIRC)andChinaBankingRegulatoryCommission(CBRC).

Ingeneral,bothagenciesaimtofosterhealthy,stablegrowthoftheinsuranceandbankingsectors,aswellasprotectconsumersfromunfairandunsavorybusinesspractices.Bydevelopingaregulatoryregimethatpromotesgreater integrationandexclusivitybetweenbanksand insurers,CIRCandCBRCwillenablegreaterinvestmentinproductdevelopmentandservicequalitywhilesimultaneouslyallowingforreasonableprofitmargins.BancassuranceisalreadythebiggestchannelforinsurancesalesinChina,andmuchisridingonitsfuturesuccess—bothforindustryparticipantsandforconsumers.

Thusfar,thepaceofreformhasbeengradual.SincetheChinesegovernmentfirstofficiallypermittedbankstooperateasmultipleinsuranceagentsin2003—galvanizingthemany-to-manydistributionmodel—ithasquicklyyetcautiouslyintroducednewpoliciesthatenabledeeperintegrationbetweenbanksandinsurers.

Oneof thestandardapproaches to integration iscross-shareholdings. InSeptember2006,CIRCfirstpermittedinsurancecompaniestoinvestinlocalcommercialbanks,settinginmotionawaveofactivity.Then,inJanuary2008,adraftregulationwascirculatedbyCBRCthatwouldgrantbankspermissiontostart insurancebusinessesbyacquiringstakes in insurancecompanies.Thepracticaldetailsofexactlyhowthiswouldworkremainedunclearat first,but later informationprovideddetailsaboutapilotprograminwhichfourChinesebankswouldacquirestakesinexistinginsurancecompanies.Thepresssubsequentlyreportedon furtherdecisions involvingCIRC,CBRC,andtheStateCouncil,aswellasonseveralanticipateddeals involvingtheaforementionedpilotbanksaswellasotherplayers. In lateNovember2009,CBRCfinallyissuedthelong-awaitedrulesgoverningcommercialbanks’investmentsintoinsurers.Nonetheless,bankshavenotyetbeenallowedtoopentheirowninsurancebusinesses,althoughgovernmentsourcessaythatrelevantpoliciesareintheworks.

Incrementalregulatoryreformofdistributionchannelsandproducttypesisunderwayaswellin2009.Forexample,CIRChasaskedinsurerstocontrolvolumesandadjustthetypesofproductsoldthroughbanks.Thisstipulationispartlytheresultofsomeinstancesofmisrepresentationofunit-linkedproducts—aswellasofthecomparativelylowembeddedvalueofproductscurrentlysoldthroughthebancassurancechannel. Inaddition,CIRCnowrequiresbankstosetupanaptnessassessmentsystemforcustomersbuyingunit-linkedinsuranceproducts.Suchproductsmustbesoldindesignatedareasinsideabankingoutlet,andhandledonlybyspecializedsalespeople. Inaneffort toavoidmisinformation inproductpromotions,anycross-sellingofunit-linkedinsuranceproductsinbanks’wealthmanagementdivisionsisnolongerallowed.

CIRCandindustrybodiessuchastheChinaInsuranceIndustryAssociationhavealsoputmoreemphasisonriskmanagementrecently,andseemtobecommittedtofosteringhealthierbancassuranceeconomicsoverall,partlyasareaction to fiercepricecompetition.Back in2006, theChina Insurance IndustryAssociationfirstpioneeredthedevelopmentofaself-disciplineagreementforbancassurance,whichsetceilingsoncommissionratespaidbyinsurerstobanks,bytypeofproduct.



Successful Pathways to a Winning Bancassurance Model

The Opportunity

Amovetowardgreaterintegrationandexclusivityamongbanksandinsurersisinlinewithgoodbusinesspracticeaswellaswithregulatoryagendas.WebelievethatChinawillsoonundergoatransitionperiodinwhichmajorplayersmovestronglyinthisdirection,leavingbehindthecurrentlydominantmany-to-manymodel.

Theexactshapethatpartnershipstakewilldependlargelyonthespecificplayersinvolved.Eachcompany’sexpansionstrategy,organizationalstructure,riskappetite,andcapitalrequirementswilldeterminewhichtypeofarrangementisbest.TaketwoestablishedexamplesinHongKong.StandardCharteredhaselectednottoownaninsurancecompanyoutright,insteadforgingastrategicpartnershipwithPrudential,theU.K.insurer.TheaccordallowsStandardCharteredtoreceivepurefeeandcommissionincomewithminimalcapital investment.HSBC,ontheotherhand,createditsowninsuranceentityandatotally integratedlineofinsuranceproducts,whichareexclusivetoHSBC.WhilethismodelprovidesHSBCwithadditionalrevenuestreams,thebankhasalsohadtomakeasignificantlyhighercapitalcommitment.

Suchstructurescanalsoworkonaregionalscale,orfocusonasingleproductorproductsubgroup.Forinstance,anexclusivedistributionpartnershipcouldbeforgedsolelyforseveralbranchesorregionswithinamuchlargernetworkorforaspecificproducttypeonacountry-widebasis.Abankcouldalsointegrateacustom-designed insurance jointventure into its systems. Inessence, the integrationof insurancebusinesses intoabankingsaleschanneloffersupmyriadopportunities forpartnerships thatcanbetailoredtoeachplayer’sparticularstrategy.

A Win-Win Approach

Banks: What they stand to gain

Whyshouldbanksalterasystemthatpaysthemsohandsomely incommissions?Aswehavealludedto,banksthatestablishexclusivepartnershipswith insurerswillbebetterpositionedtokeepa largershareoftheircustomers’wallets inthefuture.Furthermore,webelievethatfuturegrowthinChina’sbancassurancesectorwillnotcomeaseasilyasithasinthepast,andthatcontinuedsuccesswillrequiremore innovation.Banks,byprovidingbetter service to theircustomersandofferingmore targetedinsuranceproducts,candramaticallyincreasecross-sellingpotentialandfeerevenues,earningattractivemarginsfromawholenewrangeofproducts.Inaddition,withoverallpenetrationofinsuranceproductsinChinastillatarelativelylowlevel,thereissignificantroomforbankstoparticipateinhighervalue-addedpartsoftheinsurancevaluechainwithoutdirectlycompetingwithincumbents.

Some international insurershave theexperienceandcapabilities fromseveralmarkets tomakeanintegrated,exclusivebancassurancemodelwork,particularlywithrespecttosetup,productdesign,go-to-marketapproach,operations,backofficeandPOSsystems,and,ofcourse,capitalandriskmanagement.Thisisaso-farwidelyuntappedsourceofvalueforChina’sbanks.

Insurers: What they stand to gain

For insurers,buildingmore-exclusive,better-integratedrelationshipswithbanksrepresents farmorethanjustachancetocapitalizefurtheronChina’sstronggrowthinbancassurancepremiums.Therealopportunityistosolidifybrandreputationandcustomerloyaltyatatimewhenmostconsumersarestilluncommitted,overallinsurancepenetrationisstillshallow,andcompetitorofferingsarestilllimited.But



successwillrequiresubstantialinvestmentbothincapitalandhumanresources.Insurersmustthereforegainalargersliceofthepiethanthecurrentsystemaffordsthem.

Aswehavementioned,bankbranchnetworkscanprovideveryattractivemarketaccesstoinsurers.Thisisespeciallytrueinprovinceswhereinsurancepenetrationislowrelativetothebankinginfrastructure.Foreignplayers,especially,tendtolagbehindlocalplayersbothintermsofsalesnetworksandlicensecoverage.Someforeignplayershavesufferedmarketsharelossesduringtherecentrapidexpansioninbanassurancechannels—growththathasdisproportionatelybenefited localplayersgiventheir largergeographiccoverage.Joiningforceswithalocalbankmayalsohelpinsurersspeedupthelicensingprocessinnewareas.

Different Models Work for Different Players

Ofcourse,banksand insurersmustchoosethemodels thatmakethemostsensegiventheirspecificresourcesandstrategicobjectives.Wehaveobservedfourdifferentmodelswhich,dependingontheexactcontext,haveproventobesuccessfulacrossmarkets:

◊exclusivedistributionpartnership

◊ jointventure

◊financialholdingcompany

◊ integratedlineofbusiness

Exclusive distribution partnership. In thismodel, thebankand insurancecompanyagree to totalexclusivity,either inonedirectionorboth.This typeofagreementallowsbothcompaniestobroadenthespectrumof theirofferingsand leverageeachother’sbrandreputationsandexpertise inproductdevelopmentandsales.Itrequiresonlyasmuchinitial investment—insetupcostsforsalesoutlets, IT,training,etc.—asthepartnersneedinordertolaunchtheireffortsatthesametime.

This typeofpartnership canbe reinforcedbya cross-shareholding structure.However, since thebankearnsonlyadistributionmargin, insurersmustofferbanks incentives to sellaproduct thatwill complement—orpotentiallyevencompetewith—otherbankingproducts.Thismodel is idealforbanks thatopt fora lowcapital commitment in their insuranceoffering, since relatively smallinitial investmentsare required.Awidevarietyofpilotprogramsarepossibleunder this typeofarrangement.

Ultimately,anexclusivedistributionpartnershipfostersgreaterfocusandcooperationbetweenthebankandtheinsurer,andenablesamoreprofessionalizedandeffectivesalesforce.Theaccordallowsinsurerstoreachbanks’existingcustomerbasesaswellasfully leveragebankingsaleschannelsgoingforward.Inturn,thebankcanutilizetheinsurer’sexpertiseinproductdevelopmentandsalesstrategy.Also,thearrangementcanbelaunchedwitharelativelyshortramp-upperiodsincelimitedoperationalintegrationisnecessary.What’smore,thepartnershipcanbeusedasaviablelong-termstrategyifthecontractlengthissufficientandifthemutualcommitmentdeepens.

Inpractice,exclusivedistributionpartnershipsworkbestwhenbanksandinsurerscoordinatetheirsalesapproach.Thereferralprocesscanbetailoredtosuitcapacityandneeds,andcanincludesolutionssuchas



specializedcallcenters.Ingeneral,financial-servicesmanagersfromtheinsurancesidecollaboratewithbankbranchagentstoexplaininsuranceproductstocustomersalongsidebankproducts.

Prudential’sexclusivepartnershipwithStandardCharteredinHongKongisagoodexample.Underthearrangement,whichhasbeeninplaceformorethanadecade,PrudentialassignsmanagerstoStandardChartered’sbranches.Thesemanagersoffer insuranceandfinancial-planningadvicetocustomers,aswellasprovidetrainingtothebank’sstaffonhowtosellPrudential’sproducts.ThemodelhasbeensosuccessfulthatthepartnershiphasbeenexpandedtomanyotherAsianmarkets.

Joint venture.Toformajointventure,abankandaninsurersetupaseparatelegalentitytoleveragethemanufacturingcapabilitiesoftheinsurerandthedistributioncapabilitiesofthebank.Thistypeofaccordtypicallyrequiresa longer investmenthorizonthanexclusivepartnerships,andallowsthetwopartiestosharecapitalcommitment—sometimesallowingonepartytotakefullcontrolinthefuture.Theestablishmentofarevenuedistributionmechanismthroughsharepercentagecangivebanksadegreeofflexibilityinadjustingcommissionfees.

Onesuccessfulexampleofthejoint-venturemodelinAsiaisCIMBAviva,forgedbyAvivaandCIMBBank,thesecond-largestfinancialservicesproviderinMalaysia.AkeyelementofsuccessforthisventureisthatAvivasharesitsinsuranceexpertisebytransferringhighly-experiencedseniorexecutivestothenewentity,whileCIMBoffersitslargebranchnetworkforexclusivebancassurancedistribution.

Financial holding company.Thefinancialholdingcompany(FHC)model involvesasinglelegalentitywithseparateinsuranceandbankingsubsidiaries,whichmayormaynotbewhollyowned.Thisstructureallows thebalancingofdifferent financial-servicesbusiness lines,withsynergies, risk sharing,andcapitalmanagementattheholdingcompanylevel.Themodeloffersapowerfulresponsetoheightenedmarketcompetition,allowingrapidexpansionthroughaggressiveM&Aandtheflexibilitytoinvestinordivestbusinesses.Exclusiveandintegratedpartnershipsbetweengroupcompaniesarerelativelyeasytoestablishandcustomize.Whenexecutedwell,thefinancialholdingcompanymodelcankeepproductivityparticularlyhigh.

InTaiwan,mostmajorfinancialinstitutionsareorganizedassubsidiariesunderanFHC.AprimeexampleisFubonFHC,whichholdsTaipeiFubonBank,FubonInsurance,andFubonLife.Byseparating itscompanies,FubonFHCisabletoleveragesynergiesviathebancassurancemodelwhilestillmaintainingindependentoperationofeachunit.Thisisanorganizationalfeaturethat, inChina’scurrentregulatoryenvironment,wouldrepresentasignificantadvantage.

Integrated line of business. Inthismodel—basedoninternalorganizationratherthanlegalintegration—thebanksetsupanewlineofbusinessforinsurance.Thiscanbedoneorganicallyorbyacquisition,muchinthesamewayabankmightsetupanynewlineofbusiness.Thismodelprovidesmaximumstrategicandoperationalcontroltothebank,allowingittolookatinsurancefromtheperspectiveofthefullvaluechain—includingbothproductionmarginanddistributionmargin.Internalcompetitionisminimizedandeachbusinesslinefocusesonitscorecompetenceinawaythatisdifficulttoachievethroughanyothermodel.Also,aligningdifferentbusinessunitsunderthesamecorporatebusinessstrategy,governanceframework,andmanagementsystemcanenhancesynergiesbothonthecostandrevenuesides.

Whatismore,thismodelmaximizescorporatebrandingopportunities.Theincentivestosellinsurancearegreaterthaninadistributionagreement,andthebankcanbenefitfromtakingacomprehensive“lifetimevalue”viewofitscustomers.



One of the best examples is HSBC’s success in Hong Kong, where it has developed an in-housebancassurancebusinessandsetupHSBCLifeandHSBCInsurance.HSBChasalmostfullypenetrateditsdepositbaseinsellinginsurance,allowingittogainmarketsharerapidly.ItisnowtheleadinginsurerinHongKongintermsofnewbusinessgenerated.TheintegratedlineofbusinessmodelallowsHSBCtomaximizeitsshareofthecustomerwalletthroughatargeted,highly-differentiatedproductline.Ontheoperationsside,HSBCinHongKongdoesnothingbutbancassuranceandhasnosaleschannelswithtiedagents—eliminatinganyconflictsofinterest.

Finally,itisworthnotingthatofcoursenotallplayersaresuitedfortheintegratedlineofbusinessmodel,oreventhefinancialholdingcompanymodel.Whiletheaboveexamplesarewidelyrecognizedassuccessful,manyotherattemptshavebeenlessso.Someoftheseinitiativeshavealreadyledtodivestitures,andothersarestillintheprocessofsplittingup,mostnotablyinEurope.Whiletherootcausesofeachcasemaybedifferent,thereisawideconsensusthatmanagementcapabilitiesforbanksandinsurancecompaniesdiffermarkedly,andthatcombiningbothinonecorporationcanleadtoconsiderablechallengesandcomplexities.

The 10 Building Blocks of a Successful Bancassurance Model

SucceedingatbancassuranceinChinainvolvesmorethanjustchoosingtheoptimalmodel.Italsoinvolvesexcellingattheeverydaynutsandboltsofthebusiness.Inourview,therearetencriticalbuildingblockstosuccessthatrequireflawlessexecution.Let’sexplorethem.(SeeExhibit4.)

Develop products jointly. Ofcourse,therearemanywaystocombineexpertiseandtalentfrombothsidesofthepartnershiptocreatecompellingbancassuranceproducts.Inourexperience,agenuinelyjointeffortbetweenthebankandtheinsurerworksbest.

Forexample,asoundjointeffortmightstartwithmonthlymeetingsinwhichmarketingmanagersfromthebank’skeyproductlines—transactionbanking,credit,savingsandinvestment,andinsurance,forexample—gatherwithrepresentativesoftheinsurancecompanytodiscussnewproductideas.Then,inquarterlystrategycommittees,insuranceproduct-linemanagerscouldpresenttheirideastobankmanagers,whocouldthendecidewhichideastodevelopfurther.Fromthatpointon,jointproductdevelopmentteamscouldworkontheselectedideas.Meetingstructuresandformatscanvary,ofcourse.Butthegoalistosetuplastingforumsthatfosterthecross-pollinationofideasamongrepresentativesofbothsidesofthepartnership.

Streamline products.GiventhelimitedofferingsavailableinChinatoday,bancassurerswillhavemultifariouswaystodifferentiatethemselves.Forthemassmarket,however,strategiesthatconcentrateondevelopingalineofsimple,highly-targetedproductswithinseveralproductsegmentswilllikelybemetwiththemostsuccess.

RoyalBankofScotland’sstrategyintheUnitedKingdomisagoodexample.RBSoffersonly10productsviaitsbancassuranceplatform—threeinlifeinsurance,andseveninnon-life(propertyandmotorinsurance).Thisfocused,streamlinedapproachallowsRBStooptimizeproductdesignandenhanceservicequality.

Affluentcustomersegmentshavemorediverseandsophisticatedneedsthatrequiremore-complexproductsandhencecallforsalesstaffwithhigherqualificationsandamoreindividualizedsalesprocess.Largercontractvaluescanjustifytheresultinghighercostbaseandgeneratesomeveryattractivereturns.

Adopt a generalist sales model. Besidesofferingtherightproducts,establishingtherightsalesapproachcanmakeatremendousdifference.Therearetypicallythreebasicsalesmodels,definedbyhowtheyallocatethethreestepsofasalestransaction:needrecognition,clientadvice,andcontractclosure.



Exhibit 4. There Are 10 Building Blocks to a Successful Bancassurance Model

“What” “Who” “How”

Bancassurancesuccess

Bancassurance foundation

Products Sales management Sales processes

Develop products jointly

Streamline products

1

2

Adopt a generalist sales model

Create meaningful sales targets

and incentives

3

4

Bundle products for life events

Train rigorously

5

6

Upgrade IT systems

7Define

organizationalroles

8Bolster customer service and post-

sale support

9

Bancassurance success

Source: BCG experience.

Ensure capital and risk management

10

Inthe“generalist”model,allthreestepsareinthehandsofbankstaffpeopleinthebranch.Inthe“referral”model,bankstaffdirectscustomerstoin-branchinsuranceagentsafteridentifyingacustomerneed.Thethird,“specialist”modelrequiresjointneed-recognitionbybankstaffandbyanin-branchinsurancespecialist,whothenoverseescompletionofthesale.

Allthreemodelsareworkable.Yetourresearchindicatesthatthegeneralistapproach,inwhichbankstaffistrainedtosellavarietyofinsuranceproductsinadditiontobankproducts,tendstobethemosteffective.

Create meaningful sales targets and incentives. Meaningfultargetsandincentivesarecriticaltobuildinganeffectivesalesforce.Althoughvariousstrategiescanbeviable,ourexperienceworkingwithindustryparticipantsdemonstratesthatthebestwaytoboostproductivityusuallyinvolvessomecombinationofvariablecompensationforagentsandspecialrewardsforteamsuccess.Variablecompensationstructurescanbeusedtocreateadditionalsalesincentives,buildingfromabasecommission.Specialrewards,ontheotherhand,mightfocusongroupeffort,thusencouragingcooperation.Thecombinationoftheseelementsiscrucialforcreatingincentivesthatwillmotivateeverybankstafferandinsuranceagenttoattainaggressivesalesgoals.

Bundle products for life events. Offeringproductcombinations linkedtospecific lifeeventscan liftbancassurancesalessignificantly.ProjectworkcarriedoutbyTheBostonConsultingGroupinEuropehasshownthatconversionratesforevent-drivenproductcombinations—whichcanrelatetothecustomer’sfirstjob,marriage,relocation,andretirement,forexample—canreachbetween15and25percent,comparedwith2to3percentfordirectmarketingand3to10percentforgeneralproductofferingswithfollow-upcalls.



Train rigorously. Regular,comprehensive training is,naturally,avitalpartofbuildingasuccessfulbancassurancebusiness.Trainingisparticularly importantwhentheintegrationofbanksandinsurersbeginstodeepen.Thelevelofcoachingbothonthedetailsofinsuranceproductsandonsalesprocessesshouldbetailoredtothedegreeofexperienceofeachtrainee.

Upgrade IT systems. Theintegrationoffront-andback-officeITsystemsisanotherimportantelementofaneffectivebancassurancestrategy.Thefront-officesystemshouldfeatureguidelinesfordialoguewithcustomersandforefficientdataentry.Theback-officesystemmusthavehighprocessingefficiencyfeaturing fullyautomaticandpaperlessdataexchange,onlineunderwriting,andcommondatabasemanagementbetweenthebankandtheinsurer.

Define organizational roles. Theorganizationofanybancassurancepartnershipwilldependinpartonexistingmanagerialstructures.Withinthisframework,ahierarchyofrolesshouldbeclearlydefinedforagendasetting,coordination,andexecution.Evenmoreimportant,thebankandinsurershouldeachhaveparallelhierarchies inordertobalanceprioritiesandensurethebestpossible integrationateachoperationallevel.

Bolster customer service and post-sale support. Top-flightcustomerservicemustbedrivenjointlybythebankandtheinsurer.Thisrequiresthecoordinatedassignmentofspecificdutiestobankstaff,in-branchinsurancestaff,out-of-branchinsuranceagentsassignedtoagivenbranch,andcallcentersdedicatedtopost-salesupport.Selectiveuseofthird-partyadministratorscanbeconsidered,particularlywhenitcomestolinesofbusinessthatgeneratecomparativelycomplexclaims.Obviously,claimsprocessesmustbecarefullymanaged,asfailuretodosohasledtosomestrategicreadjustmentsforbancassurersinthepast.

Ensure capital and risk management. Abancassurancebusinesscanneversimplybeaself-financing“add-on”forthebank.Underwritingandassuminginsurancerisk,especiallyoverthelongterm,requiresadditionalcapitalupfrontandongoingriskmanagement.Thelatteroftenincludesthetransferofcertainriskstoareinsurer.

Regardingcapitalmanagement,whenbancassurancepartnershipsareexclusiveandstable,thebusinesscangrowrapidly. In suchcases, insurance-driven solvencycapital requirementswill increase justasrapidly for thebancassurer,andmaystrainaccountingprofitabilityaswell.Breakingevenonaninsuranceinvestmentcanthereforeappeartotakelongerforabankthanoriginallyanticipatedbyseniormanagementandinvestors.Also,insurancecapitalrequirementsprescribedbyregulatoryauthoritiescanbehigheroratleastdifferentfromthosecalculatedbythebank’sin-housemodels,requiringthebanktomakenecessaryadjustments.

Theobvioussolutionstocapitalduress involve issuingdebtorequity—orusingreinsurancesincethetransferofpremiumsandrisktoareinsurertypicallyresultsinloweredsolvencycapitalrequirementsforthebancassurer.Alloftheseoptionssecureorfreeupfundsthatcanbereinvestedelsewhereinbankingorusedtogrowthebancassurancebusinessevenfaster.

Asidefromitsusesinstandardriskandcapitalmanagement,reinsurancecanalsohelpbyofferingtailoredcoreandauxiliaryserviceacrossthebancassurancevaluechain—including,inmanycases,cooperationonproductdesign,underwritingmanuals,standardprotocols,training,provisionofITsystems,andthelike.



A Call to Action

If thecurrentstatusquoinChina’sbancassuranceindustryremainsunchangedformuchlonger,saleswillhitawallofsorts.Theprevalentmany-to-manymodelwillhamperfuturedevelopment.Already,thedemandforsophisticatedinsuranceproducts—stokedbytheforceandspeedofChina’smacroeconomicevolution—isbeingcloggedbytheimpassebetweenbanksandinsurers.Cutthroatandmono-directionalpricecompetitionwillnotfosterinnovationorraisecustomerawareness.Partnersthatintegrate,becomemoreexclusive,andinvestinthequalityoftheirproductsandservicesnowwillhaveagoldenopportunitytoestablishcompetitiveadvantage.

Indeed,banksthatdevelopexclusivepartnershipswithinsurerswillbeabletobettermeettheircustomers’currentandfutureneeds,increasecross-sellingandfeerevenues,andperhapsaddapotentiallyattractivemarginfromthelifeinsurancebusinessitself.Forinsurers,buildingsuchrelationshipswillallowthemnotonlytomaintainthepremiumgrowthwehaveseensofar,butalsotoshowcaseandsolidifytheirbrandswhilecustomerconsciousnessand loyalty isstillunderdeveloped,while thegeographicreachofmostbancassurersisstilllimited,andwhilemostcompetitorproductofferingsarestillrudimentary.

Playersmustchooseamongthefourbasicmodelsofmore-exclusiveandintegratedcollaborationbetweeninsurersandbanks.Thesizeandcapitalbaseoftheplayers,thedegreeofcontrolthateachcomesawaywith,andtheoveralleconomicsofeachdealwillstronglyinfluencetheirchoiceofpartners.Tobesure,therewilllikelybemanyregionalandproduct-specificcustomizationsofthesebasicmodels.Thedevil,asalways,willbeinthedetailsofexecution.Companiesthatbothmaketherightstrategicchoicesandthatexcel inswift implementationofamoreadvancedandcustomercentricbancassurancemodelwillfindthemselveswieldingconsiderablepowerinChina’sopportunity-richfinancialservicesmarket.



About the Authors

TheBostonConsultingGroup’s(BCG)officesinChinaandSwissRe’sofficesinChinahaveworkedtogetherover the last fewmonths toproduce thisWhitePaper. Ifyouare interested inobtainingadditionalinformation,pleasecontactBCG’sorSwissRe’sBeijingoffice.

BCG15/F.,EastTower,TwinTowers,B-12JianGuoMenWaiAvenue,ChaoyangDistrictBeijing100022,China+861085279000greaterchina.mkt@bcg.comwww.bcg.comwww.bcg.com.cn

ChrisKaye isapartnerandmanagingdirectorintheHongKongoffice.

Frankie LeungisapartnerandmanagingdirectorintheHongKongoffice.

Dr. HolgerMichaelis isapartnerandmanagingdirectorintheBeijingoffice.

SwissRe23/F.,EastTower,TwinTowers,B-12JianGuoMenWaiAvenue,ChaoyangDistrictBeijing100022,[email protected]://www.swissre.com

Chee Kok PohisaDirectorandheadofLife&HealthChina.

Eric SchuhisaDirectorandheadofBusinessDevelopmentChina.

Robert WiestisaMemberofExecutiveTeamandManagingDirectorforChina.



TheBostonConsultingGroup(BCG) isaglobalmanagementconsultingfirmandtheworld’s leadingadvisoronbusinessstrategy.Wepartnerwithclients inallsectorsandregionstoidentifytheirhighestvalueopportunities,addresstheirmostcriticalchallenges,andtransformtheirbusinesses.Ourcustomizedapproachcombinesdeepinsight intothedynamicsofcompaniesandmarketswithclosecollaborationatall levelsof theclientorganization.Thisensures thatourclientsachievesustainablecompetitiveadvantage,buildmorecapableorganizations,andsecurelastingresults.Foundedin1963,BCGisaprivatecompanywith66officesin38countries.Formoreinformation,pleasevisitwww.bcg.com.

Founded in1863 inZurich,Switzerland,SwissRe is renowned for its commitment toexcellence insecurity,solutionsandserviceandhasaproud146-yearhistoryofdeliveringforcustomers.SwissReoffers traditionalreinsuranceproductsandrelatedservices forpropertyandcasualty,aswellas thelifeandhealthbusiness.Thesearecomplementedbyinsurance-basedcorporatefinancesolutionsandsupplementaryservicesforcomprehensiveriskmanagement.

Apubliccompany,SwissResharesarelistedonthemainboardoftheSWXSwissExchangeandtradedonvirt-xunderthesymbol“RUKN”.SwissReisrated“A+”byStandard&Poor’s,“A1”byMoody’sand“A”byA.M.Best.

Havingestablisheditsfirstphysicaloperationsintheregionin1956,thecompanyhasofficesinanumberofAsiancountries, includingJapan,Korea,Singapore,China,IndiaandAustralia.Thecompany’sAsiaDivisionheadquartersisinHongKong.

SwissRewasamongthefirst foreignreinsurerstoenterChinaafterthecountrygraduallyopeneditsinsurancemarket.SwissResetuprepresentativeoffices inBeijingandShanghai in1996and1997respectively,andopeneditsBeijingbranchonDecember19,2003toconduct lifeandnon-lifebusinessthroughoutthecountry.

©TheBostonConsultingGroup,Inc./SwissReinsuranceCompanyLtd.2009.Allrightsreserved.12/09



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