Sixty years after selling its first savings bank life insurance policy, Dime Savings Bank is bolstering its role in the insurance business by creating a stand-alone unit.

In late February the New York thrift launched Dime Insurance Group, led by Melvin L. Cebrik, a 20-year veteran of Chase Manhattan Bank. Mr. Cebrik joined Dime in July to help explore insurance opportunities.

Ultimately the thrift decided to break insurance out from the brokerage arm, creating a unit that reports directly to Dime's chief executive officer, Lawrence J. Toal.

"We are concentrating the focus on insurance as a line of business rather than a secondary demand product," Mr. Cebrik said.

Dime sells savings bank life insurance, or SBLI, and term and auto insurance. But Mr. Cebrik said he also expects significant sales from property and casualty insurance, variable life coverage, title insurance, and policies tailored to small businesses.

About 400 branch employees are licensed to sell certain insurance products, and Dime plans to hire five dedicated agents for the new division as part of a pilot program. Each agent will be housed in a hub branch that will serve other branch offices, Mr. Cebrik said.

Within five years insurance sales should account for at least 5% of the company's overall revenues, Mr. Cebrik predicted. He declined to specify current insurance revenues.

The thrift has a ready pool of potential insurance customers through North American Mortgage Co., a Santa Rosa, Calif., broker it bought in 1997, Mr. Cebrik added.

"North American is one of the largest mortgage brokers in the country, and that gives us a critical mass to work off," Mr. Cebrik said. North American already sells property and casualty insurance to its customers, he said.

The creation of a unit and the dedication of executive talent show commitment by the thrift's leadership, but such a strategy has its pitfalls, warned Carmen Effron, president of CF Effron Co., a Westport, Conn., consulting firm.

"One of the biggest problems is to get the investment and insurance people to work together," she said. Forming a separate unit without providing appropriate incentives can hinder cooperation.

Dime hopes to smooth the way with the appointment of an internal board of advisers that will meet regularly to discuss the insurance program, Mr. Cebrik said.

An advisory board could certainly help minimize the risk of isolating the insurance unit, Ms. Effron said.

"That's an excellent approach because it makes the people on the other side involved," she said. The committee should help educate the other departments about insurance, she said.

Mr. Cebrik said his biggest challenge will be to get the unit "to think like an insurance organization."

To achieve that, he is working to find or develop a management information system that goes beyond banking to track insurance concerns like premium volume, penetration, and persistency.

Dime has also hired Gary Andrasko, another Chase veteran, to be vice president for business development and strategic planning, Mr. Cebrik said.

Robert Mittel, who had headed Dime's insurance program, will continue to supervise sales of insurance through the branches. He reports to Mr. Cebrik. Scott Martin, president of the North American services group, also reports to Mr. Cebrik.

Mr. Cebrik said he is looking for additional opportunities on Dime's Web site. So far, however, no bank has built a successful Internet strategy, he said.

His philosophy for Dime's insurance effort is "a customer-centered focus," Mr. Cebrik said.

Dime must provide the convenience and speed that customers desire, he said. It has an advantage in that it's been offering SBLI since 1939 so its customers know it's in the insurance business, he said.

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