It is apparent that, philosophically, bankers and insurers are beginning to decipher some of the cultural issues that divide them in the marketing and sales arena. However, the “2005 Bridging the Cultural Divide between Bankers and Insurers Study” did uncover a number of marketing and sales issues that are still contentious.

These issues include: building incentive programs that work well within the bank environment; the ability to integrate insurance sales at the point of bank sales; senior management commitment; access to the bank’s client base; and the extent of wholesaler support. As the chart shows, there are still significant gaps between what the bankers say they want and their satisfaction with what the insurers provide.

The full 80-page 2005 study concurrently examines bank and insurer views about insurance distribution, marketing and sales, product design, administration and operations, effectiveness, and risk and profitability. It is available online at .

The study uses a statistical gap analysis technique to quantify the cultural issues, therefore using hard evidence to uncover and explore the qualitative issues banks and insurers must tackle to achieve success. It was completed by 78 respondents, 48 from banks and 30 from life insurers, representing 55% of the top banks and insurers doing business today.

This scatter graph represents the answers to one marketing question that analyzes several elements. It asks specifically what the respondent believes are the most important factors in selling insurance to bank customers and how satisfied the respondent is about how well those elements are executed. By finding out what processes will make the effort more successful, guideposts can be established for starting, maintaining and growing a successful bank-insurance operation.

The scatter graph summarizes scores in this category, while the quadrants of the figure represent areas of opportunity for improving the bank-insurer relationship. This article takes only a brief look at six out of the 11 elements assessed. These are the most divisive items, where we found gap scores greater than 1.2, which is seen as extremely significant in a 5-point scale where 1 is the least important and 5 is the most important.

Notice that all the blue boxes representing insurers’ answers to questions are predominately in the upper right-hand quadrant. In every case, they are higher than the bankers’ scores, which cluster toward the lower right. This shows their high importance but low satisfaction and, therefore, where there is the greatest need for improvement.

Both banks and insurers agree strongly on the factors that are important to selling insurance, and, in fact, the overall scores for all banks and insurers came in at 3.7, or “more important.” This overall average score is misleading, however, because the spread between bank and insurer scores for satisfaction in delivery was in every case lower for banks than for insurers, with an overall gap of 1.3.

Although the scatter graph can be analyzed in a number of different ways, this article will examine only the differences in the bankers’ importance scores vs. their satisfaction.

There are significant or extremely significant gaps for every attribute, with the most significant gap (1.8) in bankers’ satisfaction with building incentive programs to entice bank employees, licensed platform bankers (LPBs), financial consultants, commercial bankers, trust officers and wealth management advisors to sell or refer insurance.

It seems obvious that what works to lure the LPB is not going to work well with the private banker or commercial loan officer; however, there are banks that have found a way to persuade each and every one of these employees to get involved. One general approach is to include the insurance sales goals in the bank goals rather than separately from them. So, for example, taking two extremes of salespeople, if the LPB has a goal to increase the number of certificates of deposits sold in a given month, then any life insurance product sold by that LPB is considered an acceptable substitute and contributes toward the CD goal. For the private banker or wealth advisor, any money a client places into an insurance product is counted toward the asset accumulation goals by computing the present value of the stream of premiums.

Another tactic at the private banker sales level is to create teams of bankers, insurance specialists and trust officers and tie each one of their performance and bonus goals together, so the private bankers see insurance is just as important as opening a new trust relationship for the bank.

The next two largest gaps are interrelated: senior management commitment (gap of 1.7) and the ability to integrate insurance at the point of sales (also a gap of 1.7).

The lack of senior management commitment makes it difficult for the carrier to spend money to create and support the technology and people needed to integrate insurance at just one institution. One potential response to this conundrum is to develop a consortium of bankers and insurers to work together with technology providers to devise a product-neutral but technologically sophisticated platform that will integrate insurance. The consortium also could work to close two other large gaps uncovered in this question: access to the bank’s client base (gap of 1.5), and sophisticated understanding of the bank customer’s demographics (gap of 1.2). We in the industry currently have a few tools that address this last concern and are in the process of refining them.

The last significant gap in this question is about wholesale support. It is clear that banks expect carriers’ wholesale support to be sustainable over the time it takes to make an insurance program successful within the bank. In conversations with bank-insurance executives, the wholesaler needs to show the energy and drive to be committed to the bank, knowledge of how a bank works and the ability to cheerlead the bank to success.

The bank must feel the wholesaler is accessible when needed but not intrusive. The bank-insurance executive would prefer an established and agreed upon schedule of support and continuing, specific training for licensed personnel. An example of superior support: a wholesaler that uses an outbound calling support facility that monitors who and what is being sold, as well as those bank employees who have not been selling so the bank can take remedial action.

Excellent reporting by the wholesaler back to the bank would include not just sales but also trend analysis plus seminar support, contest creation, and the ability to commit and support internal product-neutral sales and marketing programs. All this helps to bridge the sales and marketing gaps our study uncovered.

It is clear that, while great strides have been made in the ability of the carriers to support bank marketing and sales efforts, more creative thinking and dialogue is needed to capture the outstanding potential of life insurance still lying dormant within the banks’ client base.