Tariff war, digitalization and AI: how new global challenges are pushing banks towards the insurance sector to support businesses and SMEs

Banks must become increasingly visible to the entrepreneur precisely at a time when companies must face drastic changes to address the new challenges related to the senseless trade war wanted by Trump, the vulnerability of the environment, digitalization, artificial intelligence . It is also important to underline the link between banks and insurance : the interactions between banking and insurance activities have materialized with the deregulation that began in the late 80s.

For banks, entry into the insurance sector was stimulated by the intention to diversify revenue sources and the intent to facilitate customer investments in products other than banking products. For insurance companies , on the other hand, collaboration with credit institutions allows them to achieve economies of scale and scope in the placement of their products and to use the wealth of information that banks have available on the economic and financial conditions of their customers.

The data certify the importance of bancassurance in Italy both in terms of commercial agreements for the placement of insurance products through the network of bank branches and of banks' participation in the capital of insurance companies. Furthermore, for larger banks, the predisposition to operate in the insurance sector is positively connected with their profitability and becomes more marked with the increase in the level of control exercised by the bank over the company. For insurance companies, the distribution of products through bank branches is associated with a reduction in operating costs in the life branches and in claims charges in the non-life branches. Banks are now focusing above all on the non-motor non-life branch to boost their growth, encouraged in this by various factors such as the extension and quality of the expanded offer in the business segment; the evolution of business models with the creation of agencies specialized in SMEs and high digitalization.

There are three key factors in the success of bancassurance at European level : intense interconnection with the customer, accurate knowledge of their needs and digital transformation. Furthermore, most customers consider their bank more reliable than insurance companies and see it as a model for managing their savings; they are also aware of the possibility of purchasing damage insurance policies at their bank: in fact, few have already received at least one offer (at least half refer to policies linked to mortgages and/or financing).

Among other factors: the ease of payment, the economic conditions considered convenient and the capillarity of the branches . It is easy to imagine that bancassurance will continue to grow thanks above all to the relationship of trust with its customers. Nonetheless, to ensure constant and lasting growth over time, credit institutions will have to invest more and more in consultancy and in the development of products and services that are increasingly suited to the needs of their customers. The ability to strengthen the segment of small and medium-sized enterprises will be crucial for the success of the bancassurance sector , thanks above all to the relationship of trust with these companies in a market that is still poorly covered from an insurance point of view.

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