MARKET ENVIRONMENT FACTORS INFLUENCE ON DEVELOPMENT OF BANCASSURANCE IN LATVIA

Evija Dundure, Biruta Sloka

Abstract


Banks and insurers as part of financial service industry engage in partnership under the concept of Bancassurance. Several studies are done on this topic, focusing on economies of scale and performance of most Bancassurance common models. The purpose of this study is to identify the key market environment factors that influence the development of Bancassurance for retail banks in Latvia and the level of increase. Aim of this research is to analyse – how market environment factors influence the development of Bancassurance in Latvia. The current paper is focused on the Latvian market where several Bancassurance models are present as we test our propositions by interviewing management representatives of major stakeholders and analysing secondary market data. Main research findings – motives of banks and insurance companies in Latvia for implementing Bancassurance are in correspondence with the academia: new clients and additional revenue for insurers, improvements of customer service and loyalty for banks. Study results highlight the great impact of economic growth and technological development on Bancassurance over other market-based factors and reflect the importance of their integration for achieving better results in each model.

KEYWORDS: bancassurance, banks, insurance, market environment.

JEL CODES: M10; M38

DOI: http://dx.doi.org/10.15181/rfds.v28i2.1943


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