Question & AnswerQ&A (IC Circular Letter No. 2015-20)
Bancassurance activities refer to the presentation and sale to bank customers by an insurance company of its insurance products within the premises of a bank duly licensed by the Bangko Sentral ng Pilipinas (BSP), under rules and regulations promulgated by the Insurance Commissioner and BSP.
No. As a general rule, bank employees can only refer bank clients to insurance company representatives. Only specifically trained and qualified bank employees may preliminarily present and discuss insurance products but must be certified and trained under programs approved by the Insurance Commission.
The agreement must include provisions requiring compliance with Insurance Commission requirements, a complaint mechanism, and that bancassurance activities be conducted in distinct areas within bank premises, among other provisions.
The Insurance Commission must approve all bancassurance arrangements or agreements. Additionally, the insurance company's Board of Directors must approve or ratify the conduct of bancassurance activities and execution of arrangements.
Yes. Insurance products sold through bancassurance must have prior approval from the Insurance Commissioner before being offered or cross-sold in bank premises.
Such bank employees may assess client financial needs, preliminarily present insurance products and company profiles, discuss historical returns with disclaimers, and obtain client consent for referral, without conducting sales or concluding contracts.
Bank employees are not allowed to conduct substantial presentations discussing insurance product details or conclude contracts, including agreements on investment amounts or premiums, which must be done by licensed insurance agents.
VUL insurance products are policies whose benefits or values vary based on investment results of segregated portfolios or separate accounts, with amounts placed and accounted separately from other investments. They are not considered securities under The Securities Act.
Insurance companies must provide a Product Highlight Sheet summarizing key product information, conduct a Client Suitability Assessment, generate an Investment Policy Statement, disclose conflicts of interest, and include a standard risk disclosure statement in promotional materials.
Annually, insurance companies must submit to the Insurance Commission a Summary Report listing banks and branches with bancassurance agreements, names of bank and insurance personnel involved, complaints and claims related to bancassurance activities, and actions taken to address these complaints.