📄 Abstract
Bancassurance joins two regulated industries at a single point: a bank branch counter, where a salaried employee sells another firm's insurance policy to the bank's own customer. This article pairs one human-resource variable, the architecture of branch-staff pay and targets for third-party insurance sales, with one economic outcome, the cost of mis-selling borne by customers, insurers and the bank. It combines a structured integrative review of audit, field and regulatory evidence (Anagol, Cole and Sarkar, 2017; Christoffersen, Evans and Musto, 2013; Fecht, Hackethal and Karabulut, 2018; the 2016 Wells Fargo sales-practices case; and recent Indian regulatory and market reports) with a multitask-agency model solved for 20,000 heterogeneous branch employees per scenario. In the stylised model, a target-led scorecard produces a mis-sold share of 25.4% of policies sold and a system cost of Rs4.25 per 100 customers served, while the bank itself bears only Rs0.73 of that cost. Video verification, suitability-gated deferred pay and a need-based regime with no push incentive reduce the mis-sold share to 14.5%, 7.3% and 3.5% and system cost to Rs2.11, Rs0.99 and Rs0.46. The bank's own net value falls by only about 11% between the first and last regimes, whereas system cost falls by 89%, which explains why self-regulation by banks is unlikely and why supervisory rules on staff incentives matter. Five propositions, an India-versus-global comparison and an agenda for HR-and-economics innovation are presented. The simulation is illustrative, not an estimate of actual mis-selling prevalence.
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📚 How to Cite:
C S Ramya, Dr M Prakash , BRANCH-STAFF INSURANCE-SALES TARGETS AND THE COST OF MIS-SELLING IN BANCASSURANCE: A MULTITASK-AGENCY ANALYSIS FOR INDIAN BANKS AND INSURERS , Volume 12 , Issue 10, October 2026, International Journal of Global Economic Light (JGEL) , Pages: 8 - 14 ,