Essex Training Great Western's Brokers to Spark Annuity Sales

Great Western Financial Corp., the big California thrift, has hired Essex Corp. to help it market annuities.

The third-party marketer began training Great Western Financial Securities Corp. brokers two weeks ago to boost sales of fixed and variable annuities and of term life insurance through the thrift's California and Florida branches.

Jim Overholt, president and chief executive of Great Western Financial Securities, said the thrift's executives think Essex can help boost annuity sales substantially. Great Western's brokers will be ready to underwrite and sell term insurance policies by midyear, Mr. Overholt said in a telephone interview.

Chatsworth-based Great Western already sells life insurance through direct mail and telemarketing channels to about 80,000 customers in 27 states.

When branch customers want to buy life insurance, Great Western's brokers currently refer them to an insurance salesperson, Mr. Overholt said. After Essex's training, the brokers will sell the insurance products.

"Sales reps would rather not hand off the customer to someone else," Mr. Overholt said.

Branch sales were a small slice of the thrift's overall insurance sales last year. Mr. Overholt said they are narrowing the list of carriers whose insurance products will be sold in branches. He expects a final list to be available by the end of the month, he said.

Essex bills itself as the largest third-party marketer of investment products through banks. Last year, it says, it marketed $3.1 billion of annuities.

Great Western has sold annuities and other investment products through its brokerage since the unit's inception in 1985.

The thrift currently faces two lawsuits, one in Florida and one in California, charging that it did not properly disclose the risks of investing in mutual funds and other investment products. Last week Great Western settled a similar suit in California.

In 1996, a mystery shopping study by Prophet Marketing and Research, San Francisco, rated the 50 largest banks for risk disclosure practices and said only one did better than Great Western.

A fact sheet available at Great Western branches about investment risks received an award from the U.S. Office of Consumer Affairs last year.

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