Investment In Training Staff To Sell Insurance Is Paying Off At One CU

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YORK, Penn.-Getting better at selling credit life and credit disability has helped Heritage Valley FCU double its non-interest income over the last five years.

"As a percentage of average assets, our fees and other income used to be around 1% five to six years ago," said CEO Tim Ames. "Now we are at 2%. Had we not started looking more closely at non-interest income in 2005, I'd be really nervous as to where we'd be today in this environment."

The $70-million CU is in sound shape in a state roughed up by the recession. Capital is 10.5%, ROA last year was .75% before assessments, and the CU grew 15% in 2009 before intentionally slowing growth.

That emphasis on increasing non-interest income focused squarely on increasing the percentage of loans booked with credit life or credit disability policies attached to them, Ames said. Over 75% of the CU's loans now have those policies. "We are making about $120,000 a year just on those products, and that income is being limited by the state of Pennsylvania."

Ames noted the state sets maximums on how much income a credit union can generate from selling credit life and credit disability. "Because of that, in addition to the money we make annually, we have over $400,000 in a carry forward with CUNA Mutual Group."

What's made the difference, Ames said, is getting the loan staff "on board" with selling insurance products and the loan team "really believing in the services. They have personally seen how members have benefitted from the products and we regularly share these stories with members."

Staff, too, realize that sales of insurance products are being looked at and measured. "We monitor monthly as to whether we are meeting our goals," Ames explained. "That's very important."

Ames noted that courtesy pay and passing on mortgage applications above 15-year terms to CU Members Mortgage have contributed substantially to the credit union's boost in non-interest income.

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