National Bancassurance Conference, Chisinau, Republic of Moldova Bancassurance in Bulgaria Roumen Galabinov IUC Broker

Bancassurance in Bulgaria Terms and Definitions: The term ‘bancassurance' refers to the distribution of insurance policies through banking networks or non-banking financial institutions. This arrangement is governed by the terms of a distribution agreement between a bank and an insurer which may (or may not) be connected in terms of equity ownership. Traditionally, insurance was an integrated industry which produced and retailed its own products, but from the early 1970s onwards, some insurance companies made the decision to distribute their life insurance products via bank branch networks. As a result, banks have become natural distributors of insurance products. Since then, the market for sales of financial services has become more open, attracting new providers and distribution channel like consumer credit providers, captive credit providers and other non-banking financial institutions.

Bancassurance in Bulgaria Bancassurance Advantages: Ease of access - Customers have a natural and frequent level of contact with their bank. It is equally natural that when they visit their bank, they find straightforward over-the-counter responses to all their financial needs including insurance. Simplicity - The insurance products sold over-the-counter by banks have been specially developed to be simple to understand and simple to sell. Attractive rates - Selling insurance products via retail banking networks usually has the effect of reducing distribution costs and bancassurance products can therefore be marketed at rates that are more attractive to consumers. Security - The solvency of the insurer selected by the bank and the legal guarantee of the institutional intermediary are both reassuring factors for end-user customers.

Bancassurance in Bulgaria Bancassurance models: - Exclusive distribution agreements between a bank and an insurer - Raiffeisenbank with UNIQA only; - Open architecture where a bank distributes the products of several insurers - Unicreditbank with Allianz and Generali; - Joint ventures where an insurance company owned jointly by a bank and an insurer – United Bulgarian Bank Met Life; - Full integration – the 100% bank captive insurance company – BNP Paribas Cardif.

Bancassurance in Bulgaria Bancassurance products for the private individuals and the companies – Credit Life for the Borrowers, – Employee Benefits, – Savings : Unit Linked, Endowment, – Retirement : Pension insurance – Personal Accident / Group Accident / Labor Group Accident Obligatory

Bancassurance in Bulgaria Voluntary Life Insurance which covers employees – At Work (Working Accident) – Out of Work Protection of the living standard – To ensure there is no drop in living standard over the short / medium / long term period in case of death (or other risks covered) of the insured member (member of the staff of the Company Group) The Company covers all of its employees The Company choose the mix of covered risks with level of guarantee

Bancassurance in Bulgaria Covered Risks Death as a result of sickness Accidental Death PTD (Permanent and Total Disability as result of sickness) PTDA (Permanent and Total Disability as a result of Accident) Benefits The Insurer pays a lump sum benefit to the Insured employee or his / her designated beneficiary in case of claim.

Bancassurance in Bulgaria Payments Premium is paid with the selected coverage each quarter Can be share between the Company and the Employees Tax deduction According to the Bulgarian legislature corporations can make expenditures on each employee up to 60 BGN per months of free of tax.

Bancassurance in Bulgaria Membership: Eligible Employees of the Company, who: are actively at work at the inception date are at minimum age of 18 years and maximum 65 years have signed the membership application form to the Policy Group Life insurance Medical Acceptance – Medical acceptance process is required. It depends on the wage – Health Declaration or Medical Questionnaire Claims – Collection оf necessary documents – Employee fills up and signs directly the claim simplified declaration

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