The SIJ Transactions on Industrial, Financial & Business Management (IFBM), Vol. 3, No. 4, April 2015
Customers’ Perception Regarding
Reliability of Bancassurance Channel:
An Empirical Study
Mousumi Choudhury* & Dr. Ranjit Singh**
*Research Scholar, Department of Business Administration, Assam University (A Central University), Silchar, Assam, INDIA.
E-Mail: choudhurymousumi{at}yahoo{dot}in
**Assistant Professor, Department of Business Administration, Assam University (A Central University), Silchar, Assam, INDIA.
E-Mail: look_for_ranjit{at}yahoo{dot}co{dot}in
Abstract—Following deregulation and globalization era, Bancassurance has evolved as a strong distribution
channel in India. Bancassurance basically involves banks acting as corporate agents for insurers to distribute
insurance products. The present study attempts to analyze customers‟ perception with respect to reliability in
buying insurance from banks and impact of various demographic variables on customers‟ perception regarding
reliability of bancassurance channel. The study is based on the primary data collected from the customers
buying life insurance policies of SBI Life Insurance Company Limited through State Bank of India in
Guwahati city of Assam. The data is collected using structured questionnaire. Cronbach‟s alpha is used to test
the reliability of the questionnaire. Other statistical tools like Mean, Standard Deviation, and Crammer V test
are used to arrive at suitable conclusion. The study finds that customers have high reliability in bancassurance
channel for procuring insurance service. It is also found in the study that among the demographic variables
considered, marital status, family income and family size of customers has significant impact on their
perception regarding reliability of bancassurance channel.
Keywords—Bancassurance; Banks; Customer‟s Perception; Insurance; Reliability.
Abbreviations—State Bank of India (SBI)
I.
INTRODUCTION
O
NE of the most significant changes in the financial
services sector over the past few years has been the
growth and development of bancassurance. With the
opening up of Insurance Industry for foreign investments, the
state owned insurance companies are facing tough
competition. The competition is growing with the entry of
global players having variety of insurance schemes to tap
huge market available in India. Banks in India have a wider
network with high level of confidence and trust among
public. This made insurance companies to have distribution
agreements with banks giving birth to the concept of
bancassurance. Bancassurance is a business model in which
the banks through their wide network of branches sell the
insurance product of a specific company. The introduction of
bancassurance is initiated with the concept that the banks
with the customer base they have are able to tap the market
very well.
1.1. Bancassurance
The word Bancassurance is derived from two French words,
Banque meaning Bank and Assurance which denotes
insurance. Bancassurance is the concept of selling the
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insurance plans along with a complete range of banking and
investment products and services [Venugopal, 8]. It portrays
the blending of banking and insurance products and services
offered by bank [Jennings, 3]. In this arrangement, insurance
companies and banks undergo a tie-up, a system in which a
bank has a corporate agency with an insurance company to
sell its products. Here the bank simply plays the role of an
intermediary for sourcing business to the insurance company.
The first countries to experience the evolution of
bancassurance were Spain and France. In India, it was
initiated in the year 2000 when the Government issued
notification under Banking Regulation Act which allowed
Indian Banks to do insurance distribution. The SBI entry into
insurance business was the first for an Indian bank to enter
the insurance market. Ever since the entry of the SBI, a
number of other insurance companies has declared their
desired banking partners. In this process, both life and nonlife
companies have tied up with banks.
1.2. Customers’ Perception
The meaning of customer perception is most often used in the
context of how customers perceive the quality of the service
they are offered. Perceptions are formed through customers‟
assessment of the quality of service provided by a company
© 2015 | Published by The Standard International Journals (The SIJ)
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The SIJ Transactions on Industrial, Financial & Business Management (IFBM), Vol. 3, No. 4, April 2015
and whether they are satisfied with the overall service.
Customer perceptions of the services are influenced by the
efficiency of the service provider in delivering the service.
1.3. Reliability
In today‟s realm of customer service, reliability is an
extremely important quality to have for any company.
Reliability means the ability to perform the promised service
dependably and accurately [Parasuraman et al., 2]. Reliability
is one of the most fundamental aspects of customer retention.
Because when a company fails to provide services as
promised than it proves itself as unreliable. In such situation,
customers will be easily persuaded to switch on to the
competitor‟s company. Thus it is vital for a company to
establish itself as reliable in service delivery. It helps to
justify the customer why they should choose the company
and retains the customer when tempted by offers by the
competitors. Reliability is one of the most critical dimensions
of service quality. It is directly related to overall service
quality [Najjar et al., 4]. In Bancassurance, reliability
indicates staffs keeping accurate records such as premium
records; staffs fulfil promise in timely manner,
trustworthiness of staffs, etc [Rajasekar & Kumari, 15].
1.4. Rationale of the Study
Bancassurance is a knot between bank and insurance
company. In this model bank sells insurance product with the
help of its established network of branches. However the
banking sector in India now operates in a more competitive
environment than ever before. Customers have a wider choice
of less distinguishable products and they are much better
informed. These elevate customer‟s expectations on how
companies should care for them. In this changed
environment, creating new customers and retaining the
existing ones have become difficult tasks for banks. For
success and survival in this competitive environment,
delivering quality service has become a step of paramount
importance. This compels the banks to enhance their service
quality while providing services to the customers. Reliability
is one of the important dimensions of service quality.
Reliability is an important aspect of customer retention and
customer satisfaction. In today's economy, every company
has to fight tooth and nail to retain existing customers, and to
acquire new ones. In this light, reliability in service delivery
adds as an advantage for the company. Thus there is a need
for the banks to focus on this dimension of service quality
and identify the factors that affect reliability in delivering
insurance related services to the customers.
II.
REVIEW OF LITERATURE AND
RESEARCH GAP
Bancassurance is a new and an emerging model of channel of
distribution adopted by almost all the life insurance players to
increase the market share and insurance penetration. A
substantial number of studies have been conducted to identify
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factors influencing perception of customers while buying
insurance policy from bank.
Popli & Rao [5] emphasized trust, personal relationship
and convenience as the main reason for buying insurance
products from bank. Tiwari & Yadav [11] in their study
found that Trust & safety is the main reason for buying life
policy through banks. Other reason includes easy
accessibility, expert‟s advice and convenience. Kumari [10]
mentioned in her study that customers trusted their bank for
buying insurance policy. Ali & Chatley [13] suggested in
their study that customer prefers bancassurance for buying
policy because of ease in premium payment, timely
intimation of policy details and staff behavior. The study
identified the criteria like convenience, location, trust, brand
image, professionalism, commitment, cost, return on
investment, relation with the sales force and helps build
rapport which affects buying insurance policy through bank.
Vignesh & Amudha [18] concluded that Customer prefer
bancassurance channel because of easy payment, excellent
service, high returns, special benefits and the brand image.
Satsangi [16] concluded that customer perceives
bancassurance channel as an authentic source to purchase
insurance policy. Fan et al., [9] identified factors affecting
intention of cross-buying insurance in banks. These are
payment equity, experience, image, service convenience,
interpersonal relationship and trust. Choudhury & Singh [14]
in their study found that customers have favourable
experience of buying insurance policy through bancassurance
channel. Soni & Rao [17] also concluded that reliability as a
service characteristic is delivered significantly to the
customers under bancassurance. Vikas [7] found that
reliability is high in case of public sector insurance
companies. Duodu & Amankwah [6] studied insurance
industry in Ghana. They found that reliability has a
significant impact on customer satisfaction in insurance
industry. Khurana [12] studied Indian Life Insurance
Industry. The study shows that the there is lowest gap in
customers expectation and perception towards the reliability
dimension of service quality.
The winds of liberalization and privatization have bought
phenomenal changes in the financial sectors, particularly in
life Insurance. In this period of metamorphosis,
Bancassurance has been considered as an effective
distribution channel for insurance. Banks with its vast
network of branches provide unlimited scope to life insurance
companies for market expansion and premium growth. Based
on the above background and gap areas, the present study
bridge the gap to literature to find out customer‟s perception
of reliability towards bancassurance business model.
III.
OBJECTIVE OF THE STUDY
The study attempts to analyze:
1. To investigate into customers‟ perception of
reliability of bancassurance channel for buying
insurance service.
© 2015 | Published by The Standard International Journals (The SIJ)
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The SIJ Transactions on Industrial, Financial & Business Management (IFBM), Vol. 3, No. 4, April 2015
2.
To find out impact of demographic variables on
customers‟ perception of reliability while buying
insurance service from banks.
IV.
HYPOTHESIS OF THE STUDY
The null hypothesis considered for the study is „There is no
significant association between „demographic variables‟ and
„customers‟ perception of reliability of buying insurance from
banks‟.
V.
RESEARCH METHODOLOGY
The study is conducted using the following research
methodology:
5.1. Location of Study
In Assam, Guwahati is the biggest city. It is the commercial
hub of North-Eastern States. Large numbers of banks are
located in this city. Considering this aspect, the
Bancassurance service in Guwahati is considered to be
studied.
5.2. Data Collection
The study is mainly based on primary data. The tool of
“structured questionnaire” is used to collect the necessary
information relevant for the study. The primary data is
collected from the customers who have bought life insurance
products or service from State Bank of India branches in
Guwahati. For secondary data, official reports and records,
journals, newspapers, magazines are assessed.
5.3. Identification of Research Population
The universe of the study consists of all those customers of
37 branches of State Bank of India, Guwahati who have
received life insurance related services through the banks.
There were 3315 number of such customers (as on 11th
March, 2013).
5.4. Sample Units and Sampling Process
At 95% confidence level and 5% confidence interval, a
sample of 345 customers is obtained. This sample unit is the
customer of the bank who has bought the life insurance
product from the bank.
5.5. Development of Questionnaire
Questionnaire is developed for collecting primary data from
the bank customers who have availed insurance service from
the bank. Customers‟ perception of reliability of buying
insurance from bank is a latent variable. To measure this
latent variable 9 items were considered.The items were
keeping accurate records of insurance related transaction,
providing their services at the time they ( bank employees)
promise to do so, security of transaction, the information
provided by the channel is accurate, trustworthiness,
consistency in behavior, consistency in performance,
ISSN: 2321-242X
disclosing customer‟s financial information to others and
disclosing customer‟s personal information to others.
The responses on above mentioned items were obtained
on a five-point scale ranging from 5 to 1 where 5 denotes
very high reliability and 1 denotes very low reliability. Some
of the questions were in reverse scaling to ensure accuracy of
response.
Besides, demographic information is also collected from
the respondents. The demographic information include age,
gender, marital status, qualification, occupation, number of
family members, family income.
5.6. Profile of Respondents
Table 1: Age of Customers
Age Group
Frequency
1
Less than 25 years
17
25 years to 35 years
93
35 years to 45 years
179
45 years to 55 years
55
More than 55 years
Total
345
Source: Compiled from Questionnaire
Table 2: Gender of Customers
Gender
Frequency
260
Male
85
Female
Total
345
Source: Compiled from Questionnaire
Percent
.3
4.9
27.0
51.9
15.9
100.0
Percent
75.4
24.6
100.0
Table 3: Marital Status of Customers
Marital Status
Frequency
319
Married
12
Unmarried
3
Divorced
11
Widow/Widower
Total
345
Source: Compiled from Questionnaire
Percent
92.5
3.5
.9
3.2
100.0
Table 4: Family Members of Customers
No. of Family Members
Frequency
2
1
21
2
77
3
156
4
58
5
23
6
5
7
1
8
2
More than 8
Total
345
Source: Compiled from Questionnaire
Percent
.6
6.1
22.3
45.2
16.8
6.7
1.4
.3
.6
100.0
Table 5: Family Income
Family Income
Frequency
38
Less than 2 lakh
210
2lakhs to 5 lakhs
55
5 lakhs to 8 lakhs
28
8 lakhs to 11 lakhs
14
More than 11 lakhs
Total
345
Source: Compiled from Questionnaire
© 2015 | Published by The Standard International Journals (The SIJ)
Percent
11.0
60.9
15.9
8.1
4.1
100.0
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The SIJ Transactions on Industrial, Financial & Business Management (IFBM), Vol. 3, No. 4, April 2015
Table 6: Education of Customers
Education
Frequency
47
Less than class 10
45
Less than class 12
64
Undergraduate
135
Graduate
38
Post Graduate
16
Others
Total
345
Source: Compiled from Questionnaire
Table 9: Item Statistics
Percent
13.6
13.0
18.6
39.1
11.0
4.6
100.0
Table 7: Occupation of Customers
Occupation
Frequency
11
Professional
61
Employee officer grade
268
Employee non Officer grade
5
Others
Total
345
Source: Compiled from Questionnaire
Percent
3.2
17.7
77.7
1.4
100.0
5.7. Data Analysis
To investigate the perception of customers‟ towards
reliability of buying the insurance services provided by bank,
statistical tools like mean, standard deviation, Cronbach‟s
Alpha, Crammer V test etc. are used.
VI.
ANALYSIS AND FINDINGS
Analysis and findings of the study is given under the
following paragraphs:
6.1. Reliability of the Tool
The reliability of the questionnaire is tested using Cronbach‟s
Alpha. The result of the test is given in the table 8.
Table 8: Reliability Statistics
Cronbach's Alpha
Cronbach's Alpha Based on Standardized
Items
.922
.935
N of Items
9
Source: Compiled from questionnaire
The reliability of the scale is performed and coefficient
of Cronbach‟s Alpha was found to be 0.922 for 9 items (or
statements) considered for the study. A very high value of
Cronbach‟s Alpha (0.922) is indicative of very high degree of
reliability of scale and it also shows that the items are highly
correlated. It also shows that items considered for measuring
reliability are truly capable of measuring the latent variable.
Cronbach‟ Alpha of more than 0.70 is considered to be good
measure of reliability of scale [Nunnaly, 1].
6.2. Measuring Customers’ Perception of Reliability of
Bancassurance Channel
Perception of customers regarding reliability of
bancassurance is measured with respect of 9 items considered
in the questionnaire. The item statistics is given in table 9.
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Particulars
Mean
Security of transaction
Keeping accurate records of insurance
transaction
Disclosing financial information
Disclosing personal information
Trustworthiness
Information provided by channel is
accurate
Consistency in behaviour
Consistency in performance
Providing service at the time they promise
Source: Compiled from Questionnaire
4.14
Std.
Deviation
0.398
4.12
0.374
4.12
4.11
3.99
0.355
0.352
0.56
3.96
0.577
3.69
3.61
3.56
0.728
0.763
0.753
6.3. Scale Statistics
Table 10: Scale Statistics
Mean
Variance
Std. Deviation
35.29
15.963
3.995
Source: Compiled from Questionnaire
N of Items
9
There are total 9 numbers of items in the considered
scale. The scale used for the study was a Likert scale. The
responses were from very high reliability to very low
reliability. For the response of very high reliability a score of
5 was given. Similarly for the response of high, moderate,
low and very low reliability, a score of 4, 3, 2, and 1 were
given respectively. Thus, for a scale consisting of 9 items the
maximum score possible is 45 (9X5) and minimum score
possible is 9(9X1). The difference in scores is 36 (45-9). It is
divided by 5 to demonstrate five different layers of
perception regarding reliability of bank. Thus, the following
interpretation table is framed:
Exhibit 1: Interpretation Table
9-16.2
Very low reliability
16.2-23.4
Low reliability
23.4-30.6
Moderate reliability
30.6-37.8
High reliability
37.8-45
Very high reliability
Source: Compiled from Questionnaire
By looking at the scale statistic the mean score is 35.29
which fall under high reliability. Thus, it can be interpreted
that customers of bancassurance perceives that banks have
high reliability for procuring insurance.
6.4. Measuring Overall Perception regarding Customers’
Perception of Reliability of Bancassurance
Customers‟ overall perception regarding reliability of
bancassurance channel is given in table 11.
Table 11: Overall Perception regarding Reliability of Bancassurance
Particulars
Frequency
Percent
1
.3
Low reliability
27
7.8
Moderate reliability
260
75.4
High reliability
57
16.5
Very high reliability
Total
345
100.0
Source: Compiled from Questionnaire
© 2015 | Published by The Standard International Journals (The SIJ)
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The SIJ Transactions on Industrial, Financial & Business Management (IFBM), Vol. 3, No. 4, April 2015
Table 11 shows that customers perceive that bank has
high reliability regarding insurance service. Thus it can be
inferred that while buying insurance from bank, customers
perceive bank as a reliable distribution channel of insurance.
The relationship between customers‟ perception of
reliability and age of customers is not significant. This is
because Approx Significant value of Cramer‟s V test is 0.718
which is more than 0.05 (5% level of significance).
6.5. Impact of Demographic Profile on Customers’
Perception of Reliability of Bancassurance
6.5.2. Gender of Customers and Customers’ Perception of
Reliability
The impact of demographic profile of customers on
Customers‟ perception of reliability of bancassurance is
presented under the following paragraphs.
The relationship between gender of customers and their
perception of reliability with respect of buying insurance
from bank is given in table 13.
6.5.1. Age of Customers and Customers’ Perception of
Reliability
Table 13: Gender of Customers and Customers‟ Perception of
Reliability
Gender
Particulars
Total
Male
Female
Count
0
1
1
Low reliability
% of total
.0%
.3%
.3%
Count
22
5
27
Moderate reliability
% of total
6.4%
1.4%
7.8%
Count
196
64
260
High reliability
% of total 56.8%
18.6%
75.4%
Count
42
15
57
Very high reliability
% of total 12.2%
4.3%
16.5%
Count
260
85
345
Total
% of total 75.4%
24.6%
100.0%
Source: Compiled from Questionnaire
The association between age of customers and their
perception of reliability of bancassurance channel is
presented under table 12.
Table 12: Customers‟ Perception of Reliability and Age of
Customers
Particulars
Less
than
25
years
0
25
years
to 35
years
0
Count
% of
.0%
.0%
total
Count
0
3
Moderate
%
of
reliability
0%
.9%
total
Count
1
12
High
% of
reliability
3%
3.5%
total
Count
0
2
Very high
% of
reliability
.0%
.6%
total
Count
1
17
Total
% of
.3%
4.9%
total
Source: Compiled From Questionnaire
Low
reliability
Age
35
years
to 45
years
1
45
years
to 55
years
0
More
than
55
years
0
.3%
.0%
.0%
.3%
9
14
1
27
2.6%
4.1%
.3%
7.8%
69
134
44
260
20.0%
38.8%
12.8%
75.4%
14
31
10
57
4.1%
9.0%
2.9%
16.5%
93
179
55
345
27.0%
51.9%
15.9%
100.0%
Total
1
There is no significant relation between gender of
customers and perception of customers regarding reliability
of bancassurance channel. This is because the Approx
Significant value of Cramer‟s V test is 0.297 which is more
than 0.05 (5% level of significance).
6.5.3. Marital Status of Customers
Perception of Reliability
and
Customers’
The depiction of relationship between marital status of
customers and their perception of reliability regarding
bancassurance is presented in table 14.
Table 14: Marital Status of Customers and Customers‟ Perception of Reliability
Marital status
Particulars
Count
% of total
Count
Moderate reliability
% of total
Count
High reliability
% of total
Count
Very high reliability
% of total
Count
Total
% of total
Source: Compiled From Questionnaire
Low reliability
Married
Unmarried
Divorced
Widow/Widower
0
.0%
24
7.0%
241
69.9%
54
15.7%
319
92.5%
0
.0%
2
.6%
8
2.3%
2
.6%
12
3.5%
1
.3%
0
.0%
2
.6%
0
.0%
3
.9%
0
.0%
1
.3%
9
2.6%
1
.3%
11
3.2%
The relation between marital status of customers and
their perception of reliability regarding bancassurance
channel is significant. Because the Approx Significant value
of Cramer‟s V test is 0.000 which is less than 0.05 (5% level
of significance). Thus it can be conclude that marital status of
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Total
1
.3%
27
7.8%
260
75.4%
57
16.5%
345
100.0%
customers has impact on their perception of reliability of
bancassurance channel for procuring insurance service. Table
14 shows that married customers have relatively highest
responses for “high reliability” of bancassurance channel.
© 2015 | Published by The Standard International Journals (The SIJ)
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The SIJ Transactions on Industrial, Financial & Business Management (IFBM), Vol. 3, No. 4, April 2015
6.5.4. Number of Family Members of Customers and
Customers’
Perception
of
Reliability
of
Bancassurance
The impact of number of family members of customers on
their perception regarding reliability of bancassurance
channel is depicted in table 15.
Table 15: Number of Family Members of Customers and Customers‟ Perception of Reliability
Family Members
Particulars
1
2
3
4
5
6
7
8
More than 8
Count
0
1
0
0
0
0
0
0
0
Low reliability
% of total
.0%
.3%
.0%
.0%
.0%
.0%
.0%
.0%
.0%
Count
0
1
7
7
8
1
2
1
0
Moderate reliability
% of total
.0%
.3%
2.0%
2.0%
2.3%
.3%
.6%
.3%
.0%
Count
2
17
58
125
38
15
3
0
2
High reliability
% of total
.6%
4.9%
16.8%
36.2%
11.0%
4.3%
.9%
.0%
.6%
Count
0
2
12
24
12
7
0
0
0
Very high reliability
% of total
.0%
.6%
3.5%
7.0%
3.5%
2.0%
.0%
.0%
.0%
Count
2
21
77
156
58
23
5
1
2
Total
% of total
.6%
6.1%
22.3%
45.2%
16.8%
6.7%
1.4%
.3%
.6%
Source: Compiled from Questionnaire
The relation between number of family members of
customers and customers‟ perception of reliability of
bancassurance channel is significant. Because the Approx
Significant value of Cramer‟s V test is 0.003 which is less
than 0.05 (5% level of significance). Therefore it can be
inferred that family size of customers has significant impact
on customers‟ perception of reliability in case of buying
insurance from banks. It is evident in table 15 that family size
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1
.3%
27
7.8%
260
75.4%
57
16.5%
345
100.0%
with 4 members has relatively highest responses for “high
reliability” of bancassurance.
6.5.5. Family Income of Customers
Perception of Reliability
and Customers’
The illustration of impact of customers‟ family income on the
customers‟ perception of reliability is given in table 16.
Table 16: Family Income of Customers and Perception of Customers regarding Reliability
Family Income
Particulars
Less than 2
2 lakhs to 5
5 lakhs to 8
8 lakhs to
More than
lakhs
lakhs
lakhs
11 lakhs
11 lakhs
Count
1
0
0
0
0
Low reliability
% of total
.3%
.0%
.0%
.0%
.0%
Count
7
18
1
1
0
Moderate reliability
% of total
2.0%
5.2%
.3%
.3%
.0%
Count
25
166
39
17
13
High reliability
% of total
7.2%
48.1%
11.3%
4.9%
3.8%
Count
5
26
15
10
1
Very high reliability
% of total
1.4%
7.5%
4.3%
2.9%
.3%
Count
38
210
55
28
14
Total
% of total
11.0%
60.9%
15.9%
8.1%
4.1%
Source: Compiled from Questionnaire
The relation between family income of customers and
perception of customer regarding reliability of bancassurance
is significant. This is because the Approx Significant value of
Cramer‟s V test is 0.001 which is less than 0.05 (5% level of
significance). Thus it can be assumed that family income of
customers affect their perception of reliability for buying
insurance from bank. From table 16, it can be inferred that
customers under family income of 2 lakhs to 5 lakhs have
relatively highest reliability towards bancassurance channel.
Total
Total
1
.3%
27
7.8%
260
75.4%
57
16.5%
345
100.0%
6.5.6. Education of Customers and Customers’ Perception of
Reliability
The impact of education level of customers on their
perception of reliability in buying insurance from bank is
given in table 17.
There is no significant relation between education of
customers and their perception of reliability of bancassurance
channel. Because the Approx Significant value of Cramer‟s V
test is 0.247 which is more than 0.05 (5% level of
significance).
© 2015 | Published by The Standard International Journals (The SIJ)
46
The SIJ Transactions on Industrial, Financial & Business Management (IFBM), Vol. 3, No. 4, April 2015
Table 17: Education of Customers and Customers‟ Perception of Reliability
Education
Particulars
Less than
Less than
Under
Post
Graduate
class 10
class 12
graduate
graduate
Count
0
0
0
0
1
Low reliability
% of total
.0%
.0%
.0%
.0%
.3%
Count
6
5
7
7
1
Moderate reliability
% of total
1.7%
1.4%
2.0%
2.0%
.3%
Count
34
33
49
104
26
High reliability
% of total
9.9%
9.6%
14.2%
30.1%
7.5%
Count
7
7
8
24
10
Very high reliability
% of total
2.0%
2.0%
2.3%
7.0%
2.9%
Count
47
45
64
135
38
Total
% of total
13.6%
13.0%
18.6%
39.1%
11.0%
Source: Compiled from Questionnaire
Total
Others
0
.0%
1
.3%
14
4.1%
1
.3%
16
4.6%
1
.3%
27
7.8%
260
75.4%
57
16.5%
345
100.0%
6.5.7. Occupation of Customers and Customers’ Perception
of Reliability of Bancassurance
Table 18: Occupation of Customers and Customers‟ Perception of Reliability
Occupation
Particulars
Employee officer
Employee non
Professional
grade
officer grade
Count
0
0
1
Low reliability
% of total
.0%
.0%
.3%
Count
0
2
25
Moderate reliability
% of total
.0%
.6%
7.2%
Count
9
49
197
High reliability
% of total
2.6%
14.2%
57.1%
Count
2
10
45
Very high reliability
% of total
.6%
2.9%
13.0%
Count
11
61
268
Total
% of total
3.2%
17.7%
77.7%
Source: Compiled from Questionnaire
The relationship between occupation of customers and
their perception of reliability regarding bancassurance
business model is presented in table 18.
The relation between occupation of customers and their
perception of reliability of bancassurance channel is not
significant. This is because Approx Significant value of
Cramer‟s V test is 0.782 which is more than 0.05 (5% level of
significance). Thus, it can be inferred that the relationship
found in the sample is not traceable in the population.
VII.
ISSN: 2321-242X
0
.0%
0
.0%
5
1.4%
0
.0%
5
1.4%
1
.3%
27
7.8%
260
75.4%
57
16.5%
345
100.0%
perception of reliability has no significant relation with age,
gender, education and occupation of customers in availing
insurance service from banks.
VIII. SCOPE OF FUTURE RESEARCH
Customers‟ perception of reliability towards Bancassurance
service of private banks can be considered for study.
Customers‟ perception regarding other dimensions of service
quality of bancassurance business model can be explored.
POLICY IMPLICATION
The study attempts to explore customers‟ perception of
reliability in case of buying insurance service from bank and
the impact of various demographic variables on customers‟
perception of reliability. The study shows that customers
have high reliability in bancassurance channel for procuring
insurance service. This finding of the study substantiate the
findings of Soni & Rao [17], where reliability is shown as a
service characteristic delivered significantly to the customers
under bancassurance. The present study also shows that
marital status, family income and family size of customers
have significant impact on their perception regarding
reliability of bancassurance channel. But customers‟
Total
Others
ANNEXURE: QUESTIONNAIRE
1.
2.
3.
Age: Please (√) the appropriate option
Less than 25
25 years to 35 years
35 years to 45 years
45 years to 55 years
More than 55 years
Gender: Please (√) the appropriate option
Male
Female
Marital Status: Please (√) the appropriate option
Married
Unmarried
© 2015 | Published by The Standard International Journals (The SIJ)
47
The SIJ Transactions on Industrial, Financial & Business Management (IFBM), Vol. 3, No. 4, April 2015
Divorced
Widow/Widower
Others
4. Number of Members in Family: Please (√) the appropriate
option
1
2
3
4
5
6
7
8
More than 8
5. Family Income(yearly): Please (√) the appropriate option
Less than 2 lakhs
2 lakhs – 5 lakhs
5 lakhs – 8 lakhs
8 lakhs – 11 lakhs
More than 11 lakhs
6. Education: Please (√) the appropriate option
Less than class 10
Less than class 12
Undergraduate
Graduate
Post Graduate
Ph.D
Others
7. Occupation: Please (√) the appropriate option
Professional
Businessman
Employee-Officer grade
Employee-non-officer grade
Others
Your response regarding the reliability of bank for procuring
insurance. [5] indicate very high reliability, [4] indicate high
reliability, [3] indicate moderate reliability, [2] is low reliability and
[1] is very low reliability. Please (√) the appropriate option.
S. No.
Particulars
Keeping accurate records of
1
5 4 3 2 1
insurance related transaction
Providing their services at the time
2
5 4 3 2 1
they promise to do so
3
Security of transaction
5 4 3 2 1
The information provided by the
4
5 4 3 2 1
channel is accurate
5
Trustworthiness
5 4 3 2 1
6
Consistency in behavior
5 4 3 2 1
7
Consistency in performance
5 4 3 2 1
Disclosing your financial
8
5 4 3 2 1
information to others
Disclosing your personal
9
5 4 3 2 1
information to others
[6]
[7]
[8]
[9]
[10]
[11]
[12]
[13]
[14]
[15]
[16]
[17]
[18]
F.K. Duodu & T. Amankwah (2011), “An Analysis and
Assessment of Customer Satisfaction with Service Quality in
Insurance
Industry
in
Ghana”,
URL:
https://pure.ltu.se/ws/files/36500685/LTU-EX-201236426372.pdf.
G. Vikas (2011), “Service Quality Perceptions of Customers
about Insurance Companies: An Empirical Study“, Indian
Journal of Marketing, Vol. 41, No. 3, Pp. 8–20.
R. Venugopal (2011), “A Viable Additional ChannelBancassurance”, IRDA Journal, Vol. 9, No. 12, Pp. 33–37.
C.K. Fan, L. Lee, Y. Tang & Y. Lee ( 2011), “Factors of CrossBuying Intention - Bancassurance Evidence”, African Journal
of Business Management, Vol. 5, No. 17, Pp. 7511–7515.
T.H. Kumari (2012), “Customer Attitude towards
Bancassurance: An Indian Perspective”, Global Journal of
Current Research, Vol. 1, No. 1, Pp. 39–49.
Tiwari & Yadav (2012), “A Customer Survey and Perception
towards Bancassurance (with reference to Life Insurance
Industry)”, South Asian Journal of Marketing and Management
Research, Vol. 2, No. 2, Pp.142–164.
S. Khurana (2013), “Analysis of Service Quality Gap in Indian
Life Insurance Industry”, European Journal of Commerce and
Management Research, Vol. 2, No. 2, Pp. 41–48.
L. Ali & P. Chatley (2013) “Customer Perception of
Bancassurance: A Survey”, European Journal of Business and
Management, Vol. 5, No. 22, Pp. 34–46.
M. Choudhury & R. Singh (2014), “Financial Inclusion through
Bancassurance: A Study on Experience of Customers”,
National Seminar on Managing Rural Development in North
East India, Pp. 104– 115.
D. Rajasekar & T.H. Kumari (2014), “Bancassurance and its
Service Quality Dimension: A Study on Customer Attitude”,
International Journal of Applied Engineering Research, Vol. 9,
No. 14, Pp. 2589–2600.
R. Satsangi (2014), “An Analysis of Effectiveness of
Bancassurance as a Distribution Channel in India”, Delhi
Business Review, Vol. 15, No. 1, Pp. 41– 52.
C. Soni & N.S. Rao (2014), “A Study of Banker‟s Perception
for the Factors which Banks Deliver to Customers in
Bancassurance”, Abhinav, National Monthly Refereed Journal
of Research in Commerce and Management, Vol. 3, No. 12,
Pp. 6–15.
A. Vignesh & R. Amudha (2014), “Investors‟ Perception
towards Bancassurance in LIC, Mayiladuthurai Branch”,
International Journal of Business Management &
Entrepreneurship Development, Vol. 2, No. 4, Pp. 1–7.
Mousumi Choudhury, MBA (Mkt) is a
Research Scholar of Department of Business
Administration, Assam University, Silchar,
Assam, India. Till date she has presented
papers in four seminars.
REFERENCES
[1]
[2]
[3]
[4]
[5]
J. Nunnaly (1978), “Psychometric Theory”, McGraw Hill, New
York.
Parasuraman, Zeithaml & Leonard L. Berry (1988),
“SERVQUAL: A Multiple- Item Scale for Measuring
Consumer Perceptions of Service Quality”, Journal of
Retailing, Vol. 64, No. 1, Pp. 12–40.
J. Jennings (1997), “Bancassurance ' Re Opportunities Seen”,
National Underwriter, Pp. 71.
Najjar, Lotfollah & Ram R. Bishu. (2006), “Service Quality: A
Case Study of a Bank”, The Quality Management Journal, Vol.
5, No. 3, Pp. 35–44.
G.S. Popli & D.N. Rao (2009), “An Empirical Study of
Bancassurance: Prospects & Challenges for Selling Insurance
Products
through
Banks
in
India”,
URL:
http://dx.doi.org/10.2139/ssrn.1339471.
ISSN: 2321-242X
Dr. Ranjit Singh, M.com, Company
Secretary (Inter), FDPM (IIM-A), Ph.D.is an
Asst. Professor Department of Business
Administration, Assam University, Silchar,
Assam, India. He has more than 11 years of
teaching experience. Till date 8 no. of
books, more than 50 no. of articles in
national and internationals journals and 10
no. of articles in edited volume of different
books are at his credit.
© 2015 | Published by The Standard International Journals (The SIJ)
48