Bank Affiliation Influence on Life Insurers’ Performance Before and after the Financial Crisis

The article analyses the link between Italian life insurers’ profitability and bank affiliation. It also examines the influence that the differences in product mix and distribution costs displayed by bank affiliated versus traditional insurers has on results, and the changes that the big financial crisis caused in the previously established correlations. Our results highlights that, until 2007 neither distribution efficiency nor being bank affiliated significantly affected performance. Product mix composition did not influence results as well. After the start of the big financial crisis though, both distribution efficiency and bank affiliation prove to be crucial in fostering performance. Moreover, adverse economic conditions make product mix revision crucial in order to adapt to changes in demand and sustain profitability.