Financial Keyosk, the insurance agency outsourcer, has signed up its first bank client since being bought by Newtek Business Services Inc.
Carpentersville, Ill.-based Financial Keyosk said Monday that it had agreed to provide back-office insurance operations to Butte Community Bank, a unit of Community Valley Bancorp in Chico, Calif.
John Dawson, the chief executive officer of Financial Keyosk, said it is beginning to hit its stride with Butte Community, its 11th financial institution client.
Financial Keyosk offers life, health, property and casualty, disability, and employee benefits products to individuals and small businesses through banks and other partners. It is licensed in 49 states.
The company works through credit unions and banks that include the former Union Planters Corp. in Memphis and MidAmerica Bank in Clarendon Hills, Ill. Union Planters sold itself to Regions Financial Corp. of Birmingham, Ala., in June. Financial Keyosk said the relationship is continuing but that there is a possibility it could end.
Through the arrangement with Butte, Financial Keyosk is to supply technology, carrier access, and service centers to support insurance sales by agents the bank is to hire, and it will do so at a lower cost to the bank than building an agency from scratch, Mr. Dawson said.
Butte had an agent in mind it wanted to hire when it came to Financial Keyosk, he said, but the outsourcer will help identify and interview agents for banks that want this assistance.
For local agents, joining a bank that is working with Financial Keyosk means access to a larger customer list as well as back-office support, he said.
About half of Financial Keyosk’s clients use this hired-agent model, Mr. Dawson said, and the remainder just provide referrals to his company.
Butte Community Bank is to be the first Financial Keyosk bank client served from the outsourcer’s new Colorado Service Center.
Financial Keyosk was bought in August by New York-based Newtek, which provides business services like small-business and U.S.-guaranteed loans, electronic merchant payment processing, and Web hosting and other information technology. The ultimate plan is to rename it Newtek Insurance Agency, the companies said.
Financial Keyosk was founded by Zurich Insurance Co. of North America, which retains a minority stake.
Mr. Dawson said the acquisition by Newtek gave his company access to both capital and bank relationships. Newtek has relationships with the Credit Union National Association as well as a variety of large banks, he said, and Financial Keyosk hopes to capitalize on those.
In addition, he said, Newtek has call centers already set up that Financial Keyosk can use to support its insurance services.
Butte Community Bank has 10 branches in Northern California and $418 million of assets.
