Financial institution combines the selling of banking products like savings/current accounts/loans and insurance products through the same distribution channel. This is based on the premise that it is easy to cross-sell banking and insurance services because customers feel secure buying insurance from the same institution where they keep their savings. This helps in distributing the bank’s fixed costs over more products and there is very less incremental costs involved but the gains are high. CITIBANK sells insurance of Birla Sun Life.
