Bancassurance Course

National Bank State Life

Bancassurance Products’ Training

Learning ContractI hereby abide by the following terms:

• I shall keep my cell phone on silent

• I shall not take calls during the session

• I shall ask every single question that comes to mind!

• There are no wrong answers. Participate!

HAPPY LEARNING !!!

COMMON VALUESVISION OF NBP

“To be recognized as a leader and a brand synonymous with trust, highest standards of service quality, international best practices and social responsibility”

MISSION OF SLICP

“To remain the leading insurer in the country by extending the benefits of insurance to all sections of society and meeting our commitments to our policy holders and the nation”

Introduction to State Life

Formed under the Life

Insurance Nationalization Order 1972

(LINO)

Policies have

Sovereign Govt.

Guarantee

97.5% of all Actuarial surplus

distributed to with profit

policyholders

State Life - Overview

Strengths

Market share still

65% by total premium income By far the

largest distribution

network

Strong stable

financial Base

Life Fund is 415 Billion

AAA rated by PACRA

Has been the nursery

for producing

professionals for the

whole life industry.

Over 7 Million Policy

Holders

Most Popular

Insurance Company in

Pakistan

InsuranceInsurance – A Mechanism of Risk TransferInsurance will

provide funds in crisis to

protect customer’s

assets, savings,

standard of living and business needs.

Basic Types of Life Insurance

3 basic forms of

life insurance

are

• Term Assurance

• Endowment Assurance

• Whole Life Assurance

Bancassurance & Life Insurance

Bancassurance

Bancassurance is a French

term

Bancassurance is the

provision of insurance and

banking products as

well as services via the banks’

distribution networks to

the same client base.

Fulfilling Needs of the Customer

• Loans, Cards, Overdrafts, running finance

Borrowing Needs

• Investment, Fixed Deposits, Saving Plan (Life insurance Plan)

Savings & Growth Need

• CASA, CB, ATM, Mobile Banking, Online Banking, Phone BankingTransaction Needs

• All types of InsuranceProtection Needs

Role of Bancassurance

BANCA Plans Provides Funds for • Children education• Daughter’s wedding• Retirement • House expenses• Succession planning• Purchasing a house• Business and asset

protection• Hospitalization &

Disability• Life time income

Well being of Clients’ family

Why Do Customers Need Insurance ?

Bonus Based

Insurance

Safest and surest method of guaranteed cash provision either at a

specified time or at death.

Contracts have a Basic sum assured to which

bonuses are added. So every year cash value and risk cover value increase

steadily.

Full Sum assured plus all accrued bonuses payable on

death of life assured.

Different type of Bonuses are added to the policy. Sum

assured and declared bonuses are

guaranteed by Government of

Pakistan.

Once a bonus is added it cannot be removed from the policy. This

strengthens more security and peace of mind.

Excellent for financial planning;

• Children education.• Capital accumulation for

business or any purpose.• Retirement Planning.

• State Life is the only company which offers bonus based conventional life products fully guaranteed by GOP.Thereby allowing “The Bank” to adjust focus

depending on economic conditionsState Life has the following products which will be

sold through “National Bank of Pakistan”Conventional Products

Endowment AssuranceAnticipated Endowment AssuranceSadabahar Plan

Products Offered

State Life Products

Sadabahar Plan

Endowment Assurance

Anticipated Endowment

State Life Products

Endowment Plan

Endowment Assurance

Plan Type Bonus Based

Entry Age 10 to 65

Tenure Minimum 10 years, Maximum By the Age of 75 years

Mode Monthly, Quarterly, Semi Annual & Annual

Riders Family Income Benefit, Accidental Death Benefits, Accidental Death & Indemnity, Term Insurance, Waiver of Premium, Special Waiver of Premium, Term Insurance, Guaranteed

Insurability, Refund of Premium Rider, Hospital & Surgical Benefit

Need Guaranteed Sum Assured & return on Savings through Guaranteed Bonuses

Brief

It’s a safest and surest method of guaranteed cash provision either at a specified time or at death which provides the peace of

mind with guaranteed return of your all basic premiums paid during the saving term. The plan serves the requirements of a family in various shapes by way of financial help at retirement,

education of children or provision of capital for business.

USPs

Guaranteed sum Assured + All Bonuses is payable at the end of the specified term or at death of the assured.

All Riders are open, Make your own mix as per customer requirements

Lowest Management Charges & Lowest Riders CostYield once credited is guaranteed to be paid to the customer.

No bid offer spread and No Hidden surprises.One of the highest selling plan of Life Insurance Industry

Non Medical Limit Up to PKR 6.5 Million for the age 18 years to 40 years

Endowment Assurance

State Life Products

Three Payment Plan

Three Payment PlanPlan Type Bonus Based

Entry Age

20 to 57

Tenure Minimum 18 years, Maximum 30 years

Mode Monthly, Quarterly, Semi Annual & Annual

Riders Family Income Benefit, Accidental Death Benefits, Accidental Death & Indemnity, Term Insurance, Waiver of Premium, Special

Waiver of Premium, Term Insurance, Guaranteed Insurability, Refund of Premium Rider, Hospital & Surgical Benefit

Need A saving plan which provides guaranteed 3 payouts & bonuses on savings. Besides fulfilling the long-term financial needs, it also helps in meeting the medium

term & short-term financial exigencies.

Brief

This is a modified form of endowment assurance and is also called ‘Three Payment Plan’., the plan offers three payments throughout term of the policy. The plan offers survival benefits equal to 25% of sum insured on completion of 1/3rd and 2/3rd term of the policy

It gives you the opportunity to earn guaranteed bonuses and guaranteed payouts on your savings.

USPs

Guaranteed sum Assured is payable equal to 25% of sum insured on completion of 1/3rd and 2/3rd term of the policy & all the

bonuses and remaining 50% will be paid at the end of the specified term

All Riders are open, Make your own mix as per customer requirements

Lowest Management Charges & Lowest Riders CostYield once credited is guaranteed to be paid to the customer.

No bid offer spread and No Hidden surprises.Provides three guaranteed payouts during the policy term.

Non Medical Limit Up to PKR 6.5 Million for the age 18 years to 40 years

Three Payment Plan

State Life Products

Sadabahar

Sadabahar Plan

Sadabahar PlanPlan Type Bonus BasedEntry Age 20 Years to 60 Years

Tenure Minimum 12 years, Maximum 30 yearsMode Monthly, Quarterly, Semi Annual & Annual

RidersFamily Income Benefit, Accidental Death & Indemnity, Term Insurance, Waiver of Premium, Special Waiver of Premium,

Term Insurance, Guaranteed Insurability, Refund of Premium Rider, Hospital & Surgical Benefit

Need This plan is a safe instrument for cash provision at the time of need. With this plan, the

policyholder can secure greater protection and continued prosperity for the family at an

affordable cost.

Sadabahar Plan

Brief

Sadabahar is an anticipated endowment type with-profit plan that provides lump sum benefit at certain stages

during the premium-paying term or on earlier death. On completion of 1/3rd of the policy term, 20% of basic sum assured can be taken by the policyholder. Another 20% of the sum assured can be taken on completion of 2/3rd of

the policy term and the remaining 60% of basic sum assured plus accrued bonuses (if any) shall be payable at

the end of the policy term

USPs

This policy will participate in State Life’s surplus. Rates of bonus applicable will be 25% higher than those on

anticipated endowment plan. All Riders are open, Make your own mix as per customer

requirementsLowest Management Charges & Lowest Riders CostYield once credited is guaranteed to be paid to the

customer.No bid offer spread and No Hidden surprises.

This plan has a built-in Accidental Death Benefit (ADB) rider

Non Medical Limit Up to PKR 6.5 Million for the age 18 to 34 years

Accidental Death

State Life

Riders

SLIC Plan Riders

• AIB provides for payment of additional amount equal to the sum insured under the policy in the event of death by accidental means, or in the event of loss of two or more limbs or loss of sight in both eyes.

• 50% of the sum insured will be paid for loss of one limb; one-third of sum insured in the event of loss of one eye and one-fourth of sum insured will be paid for loss of thumb and index finger.

• Moreover, weekly indemnities are also available for total and partial disability

• If the life insured becomes permanent and total disable, an annuity of 10% of sum insured will be payable for a maximum period of ten years.

• AIB is available for the ages between 18 to 55 years.

Accident Death & Indemnity Benefit (AIB)

• This supplementary cover will provide for payment of an additional amount equal to sum insured in the event of death by an accident.

• The cover is available to lives between 5 and 55 years of ages.• Maximum term of this supplementary benefit is not allowed to exceed the

premium paying term of the basic policy, or 60 years of age of the life proposed whichever is earlier.

Accidental Death Benefit (ADB)

• This supplementary cover provides that incase of death of the life insured during term of this cover, an annuity of 10% to 50% per annum of the basic sum insured will be payable till the completion of term of this cover.

• This supplementary cover is available to lives between 18 and 55 years of ages.

Family Income Benefit (FIB)

• In the event of death of the life insured during term of TI, the sum insured will be payable in addition to the benefits payable under the basic policy.

• This supplementary cover is an excellent opportunity for individuals who want to enhance coverage

• TI is available to lives between 18 and 55 years of age

Term Insurance (TI)

SLIC Plan Riders

• This supplementary cover will provide for waiver of premiums under the policy incase of the life insured’s Total and Permanent Disability due to accident or disease which renders him unable to engage in any occupation.

•SWP is available to lives between 20 and 55 years of age.

Special Waiver of Premium (SWP)

• RPR provides for refund of premiums paid under the policy in the event of death of the life insured during term of the policy.

• This supplementary cover is available to lives between 20 and 60 years of ages.

• The available term ranges from 10 to 25 years.

Refund of Premium Rider (RPR)

SLIC Plan Riders

Additional Benefits

Family Income Benefit

Waiver of Premium ++

Term Assurance

+Special Waiver of Premium

Refund of Premium Rider

+Accidental Death & Indemnity

Benefit

Accidental Death Benefit

State Life Bonuses

State Life Bonuses

Reversionary bonus

Special Reversionary bonus

Terminal bonus

Special Terminal bonus

Terminal bonus for

(With Profit

Tables/Plans) PAID-

UP Policies

State Life offers attractive bonuses that are declared on the basis of Actuarial Valuations

Thirtieth Anniversar

y bonus Millennium bonus

Golden Jubilee bonus

One Time bonus

Loyalty Terminal Bonus

Regular Bonuses• Terminal bonus is available for all with profit policies in

force for the full sum assured, except Anticipated Endowment policies.

• It is payable only on maturity or earlier death of the life insured and does not carry any surrender value

• A pre-condition for entitlement of this bonus is that more than ten years’ premiums must have been paid against a policy.

• Presently, the rate of the bonus is Rs.60 per thousand sum.

Terminal Bonus

• Special Terminal bonus, at present rates, is available for all with profit policies.

• It is payable on maturity of the policy and does not carry any surrender value

• It is attached on the policies where Family Income Benefit (FIB) supplementary cover has remained in force for more than 10 years.

• Currently the rate of special terminal bonus is Rs.10 per thousand basic sum assured

Special Terminal

Bonus• This Bonus is payable to Paid-up policies (Whole Life and Endowment) terminating by way of death or maturity in 2010.

• It is attached on the policies where policies have been on the books for more than 10 years.

• The rate is Rs.50 per thousand Paid-up Sum Assured for each year

Terminal bonus for (With

Profit Tables/Plans)

PAID-UP Policies

Other BonusesMillennium

• It is payable in full on maturity or earlier death of the life insured.• The rate of bonus is Rs.51 per thousand sum assured. This is just a one-time bonus.

Golden Jubilee• It is payable on maturity of the policy or earlier death of the life insured and does not

have any surrender value. • The rate of bonus is Rs.50 per thousand sum assured. This is just a one-time bonus.One Time• It is payable on maturity of the policy or earlier death of the life insured and does not

have any surrender value. • The rate of bonus is Rs.40 per thousand sum assured. This is just a one-time bonus.Loyalty Terminal• This bonus was announced for the first time in 2007 Actuarial Valuation. • This bonus has been retained in 2010 Valuation. It is payable to all with profit Pak Rupee

policies that have been with State Life since 1991 or earlier. • The rate of Loyalty Terminal Bonus is Rs.200 per thousand sum assured and will be paid

on claims by death or maturity in 2011 to with profit Pak Rupee policies with risk year 1991 or earlier.

SLIC Bonuses

History & Trends

Reversionary Bonus

Reversionary Bonuses per thousand of sum assured to with profit Pak Rupee policies

Description of Plans

For first fivepolicy year/ Rs. Per

thousand 

From 6thpolicy year to

16th policy year / Rs. Per thousand

From 17thpolicy year

onwards / Rs. Per thousand

FOR ENDOWNMENT PLANS

Term of policy      

20 years and over 50 94 130

15 to 19 years inclusive

35 81 81

14 years and less 20 66 -

Reversionary Bonus Reversionary Bonuses per thousand of sum assured to with

profit Pak Rupee

Description of Plans

For first fivepolicy year/ Rs. Per thousand

 

From 6thpolicy year to16th policy

year / Rs. Per thousand

From 17thpolicy yearonwards /

Rs. Per thousand

FOR SADABAHAR PLANSTerm of policy (in

years)     

20 years and over 44  86  12515 to 19 years

inclusive31  74  74

14 years and less 24  66  -

0

20

40

60

80

100

120

140

48 48 48 48 48 50

90 90 9094 94 94

130 130 130Endowment Plan – 20 Years & Above1999 - 2011

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Anticipated Endowment Plan – 20 Years & Above (1999 – 2011)

Minimum Premium

• PKR 4,000 (Annually PKR 48,000)

Monthly Mode • PKR 5,000

(Annually PKR 20,000)

Quarterly Mode

• PKR 7,500 (Annually PKR 15,000)

Semi Annual Mode

• PKR 15,000Annual Mode

Sum at Risk

Age

18 - 34 35 - 40 41 - 55 56 - 65Up to 500,000 Non-Medical Non-Medical Non-Medical Non-Medical

500,001 to 1,000,000 Non-Medical Non-Medical Non-Medical Non-Medical

1,000,001 to 2,000,000 Non-Medical Non-Medical Non-Medical MR, PUR, BS, EX-

ECG, LFT

2,000,001 to 3,000,000 Non-Medical Non-Medical Non-Medical

MR, PUR, BS, EXECG, LFT, SC,

HEP(B&C)

3,000,000 to 5,000,000 Non-Medical Non-Medical MR, PUR, BS, EX-

ECG, LFTMR, PUR, BS,

EXECG, LFT, SC, HEP(B&C)

5,000,001 to 6,500,000 Non-Medical MR, PUR, BS, EX-ECG,

LFTMR, PUR, BS, EX

ECG, LFT, SC,HEP(B&C)

MR, PUR, BS, EX ECG, LFT, SC,

HEP(B&C)

6,500,001 to 10,000,000

MR, PUR, BS, EX-ECG, LFT, SC

MR, PUR, BS, EX-ECG, LFT, SC, HEP(B&C)

MR, PUR, BS, EX-ECG, LFT, SC,

HEP(B&C)

MR, PUR, BS, EXECG, LFT, SC,

HEP(B&C)

Above 10,000,000 MR, PUR, FBS, EX-ECG, LFT, SC, CHEST X-RAY, HEP(B&C), HIV, RFT

Medical & Non Medical Limits

Other Policy Options• Policy should be inforce for at least 2 consecutive years.• Surrender Value is Guaranteed to be not less then 30% of Aggregate Premiums.• Following are the exclusions• Premium for the 1st policy year• Extra premiums and premiums for any riders.

Surrender

• The amount of Loan shall not exceed 80% of the net Surrender Value• Current Mark Up Rate is 12.5% per Annum

Loan

• Policy has acquired a surrender value and premium remained unpaid.• Following Two options are available .• Automatic Paid Up• Automatic Premium Loan

Automatic Non – Forfeiture Option

• Policy Holder can cancels the policy within 14 days of its commencement date.• Premium will be refunded without any deduction.

Free Look Period

AFTER SALES SERVICES

How to sell Bancassurance??

SALES PROCESSING

Seven Steps of Sales CycleProspecting (Client Profiling

KYC)

Pre-approach preparatio

n

Approach (A.I.D.A)

Fact Finding/Ne

ed Assessmen

t

Plan Presentation (S.P.I.N)

Objection Handling

Closing

S = Situation: 1. Discuss the general situation or a subject of

prospect’s interest e.g. Cricket, sports. 2. Avoid controversial topics like politics etc.

P = Problems: Now come to the problem (Needs, Wants, Desires) of the client and the solution, which you want to offer through life Insurance. I = Implications: What are the different aspects of the problems and how it relates to the prospect may be discussed at this stage and solution applied.N = Negotiation: This means details of the sale. When he should buy, sum assured, premium mode Etc.

REMEMBER SPIN FORMULA FOR SALES CLOSING

DocumentationCNIC Copy

Proposal Form

Signed Illustration

Debit Authority Form

Basic Fact Sheet

Comparison of SLIC Actual Declared Bonuses

Rate of Return 1st – 5th Year Policy

6th – 16th Policy year

From 17th Policy Year and Onward

7% 19 35 49

9% 30 57 79

11% 44 83 115

(15% )+ SLIC Actual Bonuses Declared

50( Actual) 94( Actual) 130 (Actual)

Group Work

• Case Study of Bonus Based Polices (Actual Comparison)

• Trainer Illustration (10 Min)• Group preparation (25 min)• Presentations by group (05 min/Group)

Assigned Questions• What total amount (Guaranteed by GOP) a

accountholder of NBP will get after completion of 20 years NBP-SCLIC Policy?

• After how many years an accountholder may get full amount back on his/her policy (Breakeven Point)?

• In case of death of a policyholder (Allah Forbid), after 8 years, what amount payable to nominee?

• What amount payable as cash value on surrender of a policy after 12 years?

State Life Insurance Corporation of Pakistan

Bancassurance Divisio

n Karachi