WASHINGTON BUREAU – Several senators are crafting a compromise that could keep the financial services bill “Volcker rule” provision from applying to life insurers.

Sen. Christopher Dodd, D-Conn., the chairman of the Senate Banking, Housing and Urban Affairs Committee and primary overseer of the drafting of the “Dodd bill,” and other supporters are hoping the compromise could persuade Sen. Scott Brown, R-Mass., to cast the 60th vote that Democrats need to have the bill come up for a vote on the Senate floor.

The Volcker rule, named after White House economic advisor Paul Volcker, would prohibit banks and possibly other large, non-bank financial firms from engaging in proprietary trading, or trading unrelated to customers’ needs.

Brown said Sunday on “Face the Nation” that he would support a filibuster of the bill in its current form, because, in its current form, the bill would hurt Massachusetts companies such as Liberty Mutual Insurance Company, Boston, and Massachusetts Mutual Life Insurance Company, Springfield, Mass., and cost the country as many as 25,000 to 35,000 insurance jobs.

Senate Democrats greeted Brown’s job loss estimate with skepticism.

Rep. Barney Frank, D-Mass., told the Boston Globe that, “No one has argued to us this is going to be cutting jobs as an overall in the economy. I have no idea where that figure came from. I don’t think anybody does. It may have just been spewed out by the Icelandic volcano with some of the other debris.”

“We’ve lost 8.5 million [jobs] under the present system,” Dodd said. “Frankly, I don’t want to go back to that. I’m sure [Brown] doesn’t either.”

According to several sources, a group of Senate Democrats led by Sen. Jeff Merkley, D-Oregon, and Sen. Carl Levin, D-Mich., are working under Dodd’s auspices to craft narrow language that would exempt insurers from a Dodd bill provision that would limit some investment activities of financial companies that include deposit-taking banks.

The issue is key to Massachusetts insurers, according to the sources, because the current version of the Dodd bill would limit their ability to operate a consortium formed in 1977 that provides venture capital for firms doing business in Massachusetts.

The consortium, the Massachusetts Capital Resource Corp., a limited partnership owned by Massachusetts life insurers, has invested about $575 million in 300 businesses.

“Since Senator Brown has made clear his main concern is the bill’s impact on Massachusetts companies, any compromise on the issue could well win his support for the bill,” a source said.

Dodd said Monday that he hopes to start Senate floor action on the bill Wednesday or Thursday.

The American Council of Life Insurers, Washington, got involved in the issue Monday. In a letter signed by 22 life company chief executive officers and sent to all members of the Senate, the ACLI says the current version of the Volcker rule provision would cause “severe damage” to the basic model of life insurance holding company systems.

The insurance industry supports the language in the financial services bill passed by the House in December. That bill leaves regulation of investment activities of companies that control depositary institutions up to regulators.

The ACLI says owning an ancillary depository institution allows life insurers to provide comprehensive trust, estate planning, financial planning and advisory services, thereby enabling companies to effectively and efficiently serve the financial needs of customers at every stage of life.

“We do not believe the elimination of insurers’ ability to provide these services is in any way a desirable public policy goal,” the ACLI says.

An insurance industry official noted that life insurers take in premiums today and invest the premiums so that they can meet future insurance and retirement income obligations many years from now.

“Under the Volcker rule, this would be considered prohibited proprietary trading,” the source said.

The Senate bill “recognizes that this makes little sense, because it calls for a study of how to avoid interfering with insurance company investments, but it contains no exception,” the source said.