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Life Health > Life Insurance

Phoenix Looks To Expand In The Bank Market

By Trevor Thomas

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Michael J. Gilotti admits the Phoenix Companies, Hartford, Conn., is not a big player in life insurance in the bank channel at the moment. But hes looking to change that.

“Increasing sales [of life products] in banks is easy, because we dont have a strong presence there now,” Gilotti comments wryly. Phoenix promoted him in August from head of annuity sales to executive vice president of wholesaling, distribution and marketing. Part of his charge is to expand greatly upon the companys currently modest entry in the bank market.

Phoenix dipped its toe in the channel with a fixed annuity in May 2001. After gradually increasing its bank foothold in annuities, it now wants to build sales of its life products to banks affluent investors.

Phoenix has 147 wholesalers, many of whom will be working closely with banks to help them to sell its products, the executive says.

“Its not something where we are going to be satisfied with marginal increases in bank sales,” says Gilotti. “We want banks to be [an] integral part of our overall business. We decided to dedicate some resources to the task and hired some people who are truly specialists in the banking arena.”

The specialists of whom Gilotti speaks are two industry veterans hired at the end of September to fill two new corporate positions. James J. Polhemus became senior vice president and Richard Sippel was appointed vice president of bank distribution for Phoenix Home Life Variable Insurance Co., a subsidiary.

Polhemus comes to Phoenix from bank insurance consultant Strategic Financial Solutions, White Plains, N.Y., a subsidiary of the Sage Group Ltd., Johannesburg. He will be responsible for his companys overall bank strategy, including developing partnership deals with banks to sell annuities and insurance.

Sippel will be responsible for developing existing bank relationships. He had previously been a regional vice president of Keyport Life Insurance Company, a subsidiary of Sun Life Financial Services Inc., Toronto.

Phoenix already hired a number of Keyports annuity specialists late last year after Sun Life acquired Keyport.

Its sudden addition of experienced annuity producers helped Phoenix decide that it was time to get into the bank market, Gilotti adds.

In July, Phoenix gained additional ammunition for expanding into the bank channel when it acquired the variable life and variable annuity business of Valley Forge Life Insurance Company, a subsidiary of CNA Financial Corp., Chicago.

That acquisition fortified Phoenix with more than 12,600 contracts carrying a total account value approximating $624 million.

Polhemus and Stipple have been in the bank arena for a long time, Gilotti notes, and have extensive contacts in financial institutions.

Phoenix already has 15 bank relationships, including Webster Financial Corp., Waterbury, Conn.; SouthTrust Corp., Birmingham, Ala.; and Nexity Financial Corp., also in Birmingham.

“In the short time Polhemus and Sippel have been with us, they have contacted another 25 out of 100 banks weve targeted,” Gilotti says.

After making inroads in the bank channel through its annuities, Phoenix plans to enlist banks that have a large base of wealthy clients for its life products. In addition, it will pursue relationships with institutions that have significant private banking relationships involving extensive estate planning. These will be prime candidates for sales of its variable and second-to-die life insurance products, Gilotti observes.

Phoenix will also work with banks that already have significant life insurance productivity, he adds.

Regionally, Phoenix will target banks all areas of the country, but Gilotti sees the South, including Texas, and the Northeast as special “pockets of opportunity” for his companys wealth-management products.

“Were not going to push banks to get into all of our products,” concludes Gilotti. “For us, its the profitable aspect of sales that is far more important than quantity.”

Reproduced from National Underwriter Life & Health/Financial Services Edition, October 28, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

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