The Effects of Bancassurance and the Business Strategies of Life Insurance Companies

Jung SeChang; Younghyo Song

The purpose of this paper is to measure the net effects of bancassurance, which overcomes the limitations of the existing studies. This paper is also to analyse the characteristic variables of life insurance company influencing the performance of bancassurance. The useful implications can be suggested by regressing the net effects of bancassurance on the characteristic variables. We estimate the translog cost function and measure the degree of the scale and cost complementarities. We employ regression in order to analyse the relationship between the degree of the scale and cost complementarities and the characteristic variables of life insurance company. We observe scale economies, but cannot find any cost complementarities which is an important cause for introducing bancassurance. It is desirable to decrease the number of distribution alliances with banks for the economies of scale and also cost complementarities. It may be required to reduce the product ratio sold by bancassurance for the scale economies. The scale economies may be realized in a company which focused on the protection products.

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* 2021년 이후 발행 논문의 참고문헌은 현재 구축 중입니다.

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