3.4. Evolution In Pakistan Life Insurance Sector:
Development framework shows the item advertising move starting from “Simple” to
“Sophisticated” items again the most recent 15 years.
Depositor ‘s insurance
16 Banks active
With the main
trust on life insurance its business is expanding exponentially. 5 banks have offered credit life on
group basis – premiums are taken from clients or compensated by the bank by product
margins. 2 banks have started telemarketing of life insurance products –
personal accident and critical illness products. 2 banks have actively made an
entrance into bancassurance agreements – products offered: personal accident,
unit-linked life assurance. Agency system of bancassurance model has been followed
due to which life insurance markets develops
3.5. Banks Active In Bancassurance:
are the banks which are active for Bancassurance:
Standard Chartered, Faysal
bank, UBL, Silk bank, Allied Bank JS bank,Barclays,NIB bank, Askari bank, Citi
bank, Bank Alfalah, HSBC and Soneri Bank are the active banks for bancassurance
in pakistan which sell life insurance products (Ahmed,2011).
3.6. Contribution Due To Bancassurance:
New Business – 2010
Trends of life insurance demand:
The growth of Life
insurance can be measure by life insurance insurance penetration which is due
to introducution of channel of bancassurance,as shown by above graph which is
due the introduction of banassurance disttibution channel in different
banks.therefore life insurance in pakistan is facing with annual growth of
30-35% while 20% growth in demand of life insurrance is due to bancassurance.
Barriers In Demanding Life Insurance Policy In Pakistan
The barriers can be classified in two
1 – Community related barriers
2 – Barriers regarding Company policies
and staff behavior
– COMMUNITY RELATED BARRIERS
Because of there are some important factors
due to which people are uncomfortable in buying the life insurance policy.
analysis of people views about the life insurance demand, buying life insurance
is a “regular” expense. Due to which majority of population avoids its demand.
As the people do not enjoy the benefits of life insurance policy at the moment
of purchase therefore they feel its purchase as a burden of paying premium as
of trust on insurance companies is Another essential barrier that actually
stops the community from demanding life insurance policy that they will repay
their premiums on completion of policy or not (Ahuja, 2012).
large part of community has particular religious beliefs about the life
insurance demand regarding Islamic thoughts in term of investment of interest
and markup, which stops the people to buy the life insurance policy.
other issue which stops community to purchase a life insurance policy is
limited financial condition because of its lurxious nature everyone wants to
safe their future but their important needs take the finance away from buying
the life insurance policy.
barrier in making low demand for life insurance is less awareness about life
insurance plans and its real benefits.
level of common community is not such high to realize the advantage of life
insurance policy accordingly (Sigma, 2006).
3.6.2. Barriers Related To Company Policies And
Policies of insurance company and its
staff’s behavior are considerable barriers of purchasing life insurance policy
by the community.
insurance companies in Pakistan have complicated rules and regulations which
are hardly understand by general public for they do not cover the actual status
of life insurance policy.
about life insurance policies in Pakistan Insurance companies mostly rely on
their work force and they give all information about life insurance plans.
Mostly they give false information to the policy buyer. The insurance companies
do not heir their work force on basis of education level, training or
experience due to overall dependency on this less educated field force, most of
community are fearful from insurance policies.
of system to deliver information and awareness about life insurance policies
through seminars, workshops which attract all levels of community towards their
life insurance policies (Sigma, 2006).