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October 16, 2003 at 08:00 PM
Selling Insurance In Banks: Its More Than Referrals
By
I frequently have conversations with both insurance company executives looking to distribute life insurance through banks as well as producers evaluating the prospect of becoming an insurance specialist inside a financial institution. In most cases, the burning question in their minds is, “How do you get bankers to refer their customers to you for insurance?”
My answer is always the same: We dont. Rather, we prefer to help the bankers bring insurance to their customers.
Clearly, bank customers, with their affinity to the institution, are valuable. But the potential value of a prospect, whether an individual or a commercial account, is greatly enhanced if the skills, personal relationship and financial expertise of the banker is effectively leveraged.
Regardless of what the stereotypes might suggest, most bankers are good salespeople with an impressive approach toward building long-term relationships.
This is especially true among commercial bankers–that is, those who work with business clients as opposed to individual consumers. However, retail branches were the first to demonstrate success in insurance product integration, by selling annuities through investment representatives and licensed bank employees. While life insurance is arguably more difficult to sell from a bank lobby than annuities, there is still great potential for retail bankers also to be a successful sales platform for term life and long term care insurance products.
The most significant yet most overlooked opportunity for insurance sales in banks resides within the commercial sales division. With appropriate consideration given to commercial bankers inherent skills, sales expertise and massive relationship base, the opportunity to leverage this sales force for business, estate and employee benefit insurance activities is staggering. In fact, at UMB we have begun to license many of our commercial bankers so that they have the ability to discuss insurance with their business clients. And while the complexity of some insurance products hinders a licensed commercial bankers ability to close sales without the help of an experienced insurance professional, he or she plays an integral role in the process.
I like to refer to commercial bankers as sort of perpetually new agents. When most of us entered the life insurance sales profession, we started by learning what we needed to pass the state insurance exam. Further training followed on how the products worked and why our prospects might need them. Initially, our goal was to know enough to approach our personal network of family, friends and contacts to secure an appointment to discuss a particular product or concept. At that point, our sales manager would actually conduct the sales presentation and close the sale. Subsequently, the agent had the opportunity to continue to manage the ongoing post-sale relationship.
If you substitute “agent” with “commercial banker,” “sales manager” with an “insurance professional” and “personal network” with “commercial customers,” you essentially have the sales delivery strategy we use.
There is an array of business and corporate culture issues that make delivering insurance within a bank unique. To achieve an approach that successfully integrates insurance into the banks sales channels while being mindful of those business and cultural issues, I recommend a program that incorporates three objectives:
1. Use your dedicated insurance expertise wisely. UMB thinks of its product delivery model in terms of three types of sales processes: direct, platform and dedicated. The processes differ in complexity and in the level of competence required to support an insurance transaction.
