Kbank expects life-insurance boost
Kasikornbank expects the incoming Pheu Thai-led government's plans to hike the daily minimum wage to a flat Bt300 and raise the starting salary of new graduates to Bt15,000 a month will lead to more people taking out life insurance.
KBank first senior vice president Silawat Santivisat said yesterday that when fixed-salary people received higher income, they would consider buying life-insurance policies. Moreover, tough competition in the insurance market had led to more affordable premiums, as well as more payment options. A recent survey by the bank found that white-collar workers with a monthly salary of Bt15,000 could afford premiums of Bt700 per month, and that they sought life-insurance covering savings, medical insurance and emergencies.With new graduates seeking financial security, KBank has launched a life-insurance product with a minimum premium of Bt700 per month over 15 years. Silawat said such a policy was expected to win good business if the Pheu Thai-led government carries out it stated policy of guaranteeing the minimum salary for new graduates at Bt15,000.KBank targets Bt700 million in first-year premiums from the new product, he said, adding: "The amount of first-year premiums for this product is not that much, because the premium requirement is only Bt700."In the first half of the year, overall premiums through KBank's bancassurance was Bt15 billion, with first-year premiums accounting for Bt5.7 billion. Meanwhile, total premiums in the life-insurance market over the period were Bt120 billion, a year-on-year rise of 14 per cent. KBank projects its first-year premiums through bancassurance business this year at Bt12 billion, representing annual growth of 40 per cent. About Bt7 billion of the total is personal accident insurance and the remainder mortgage-reducing term assurance. The latter is growing in line with the bank's mortgage lending, said Silawat.Overall KBank premiums this year are expected to reach between Bt28 billion and Bt30 billion, which would mean growth of about 40 per cent, in line with the expected expansion in first-year premiums. Bancassurance business contributes 10-20 per cent of the bank's fee income, he added.