Kasikornbank boosts base for insurance

More room to grow in upper mass segment

Kasikornbank (KBank) plans to expand its bancassurance customer base by focusing on the upper mass segment — people with monthly incomes of 15,000 to 25,000 baht.

Half of KBank’s 12 million retail customers are low-, lower-middle- and middle-income earners, and it defines the upper mass segment as comprising the lower-middle group.

Pakorn Partanapat, an executive vice-president of Thailand’s fourthlargest lender by assets, said this upper mass segment will be mined for more policyholders.

Its small mass-market base means KBank has room to grow in this segment, he said.

As well, it will create more opportunities for low-income workers to buy insurance products at affordable prices and with simple conditions.

Total insurance premiums are only 2.95% of Thailand’s gross domestic product compared with 4.09% in the overall Asian market, so the industry has high growth potential, particularly in terms of bancassurance.

The proportion of insurance policyholders in the population has been steadily increasing over the past five years, from 24% in 2008 to 32% last year.

‘‘Insurance policyholders are largely high-income earners. The bank’s wealthy customers already holding insurance policies represent 30% of the overall client base,’’ he said.

KBank, in collaboration with partner Muang Thai Life Assurance, yesterday launched a new life insurance product called ‘‘Can’t Work? Don’t Worry’’.

The product is designed for selfemployed customers, with low premiums starting at 19 baht a day and coverage of up to 200% of the sum insured for a maximum of 100,000 baht and daily hospital benefits of up to 365 days.

The premium payment period is fixed at 20 years, while coverage lasts until the insured person reaches age 95.

KBank expects 20,000 new policyholders from the product for a combined 140 million baht in premiums by year-end.

In the first half of this year, KBank’s bancassurance premiums totalled 21 billion baht, up by 34% year-on-year for a market share of 23% in the segment.

Of the total, 11 billion baht was firstyear premiums, up by 39% year-onyear and accounting for a 24% market share.

With first-half growth higher than targeted, KBank has revised up its premiums target from bancassurance to 40 billion baht this year from the previous forecast of 36 billion.

Shares of KBANK closed yesterday on the Stock Exchange of Thailand at 182.50 baht, down 50 satang, in heavy trade worth 1.7 billion baht.