The role of bancassurance in the growth of mixed life insurance premiums in the Republic of Serbia

Mixed life insurance, supported by favorable tax treatment, has proven to be an attractive product for bancassurance sales in many countries within the unified European insurance market. This fact is supported by data showing that in Italy, France, Spain, Portugal, Turkey, and Malta, the share of life insurance premiums generated through bancassurance exceeds 70% of total life insurance premiums on average. In contrast, the average share of life insurance premiums realized through bancassurance in the Republic of Serbia, at 16.77% between 2014 and 2022, indicates significant room for growth. This paper analyzes the reasons for the insufficient participation of Serbian banks, as insurance intermediaries, in the sale of mixed life insurance, despite the numerous advantages that bancassurance offers. These include access to a substantial client base and the personnel and technical support provided by the insurance company represented by the bank. Based on this analysis, the paper presents proposals for further development of bancassurance to increase life insurance premiums in Serbia. The proposed approach is based on a different understanding of this distribution channel— not merely as an additional source of revenue for banks and insurance companies, but as a crucial factor for their sustainable business operations in the coming period.The need for a different approach by all participants in bancassurance, compared to the current model, is driven by the evolving preferences of bank clients regarding the investment of their disposable financial assets. These changes are largely influenced by the increasing availability of information through the internet and social media.