Many banks have begun selling insurance in recent years. But that's news to most of their sales staff, a study has found.

In a survey of branch employees and call-center representatives at 26 banks, 69% did not know their bank sold insurance, according to Stern Marketing Group, Berkeley, Calif. And of the 31% who did know, nearly half could not describe the types of products offered.

In a few instances, potential customers were being turned away.

"You must have the wrong number," one bank representative told a caller pretending to be a consumer. To the question "Do you sell insurance?" an employee at a bank with a wide insurance menu replied, "No, we're a bank."

The findings were an indictment of selling practices at commercial banks, said Charlene Stern, president of the marketing firm that did the study.

"It's like going into a hardware store and asking, 'Do you sell drills?' and the guy says, 'No,'" Ms. Stern said. "I think banks are far from ready and capable to sell insurance."

Bankers said they are aware of the referral problems but argued that the situation is hardly surprising given the relative newness of insurance as a commercial banking product.

The same issues plagued banks' early efforts in investment products, said Felice L. Larmer, chairman of the brokerage unit at First Merit Corp., Akron, Ohio. But as employees selling those products were included in bank retail meetings and worked alongside bankers, they "became part of the banking family," she said.

"Until we do the identical thing on the insurance side, I'm afraid it will continue," Ms. Larmer said.

First Merit's Ms. Larmer said high turnover among front-line bank employees, along with the expanding array of retail products they must sell, probably contributes to the problem.

She said her company has been holding insurance training sessions with front-line employees. But she conceded that this effort has yet to pay off.

David L. Holton, president of the insurance unit of Wachovia Corp., Winston-Salem, N.C., said it's too early to judge banks in insurance. "Many programs have been in pilot phases," he said.

Ms. Stern disagreed. After all, she said, banks have spent millions to promote themselves as financial centers, some even dropping "bank" from their names. And the press tends to trumpet news of a bank's selling new products.

"Every employee who has contact with the customer ought to know if the bank sells insurance," Ms. Stern said. "Every employee should know the types of insurance the bank sells."

Stern Marketing did the survey in early September as part of a continuing effort to explore issues related to marketing financial services. It directed its employees to call banks nationwide and to visit bank branches in California and New York.

The "customers" claimed their spouses had asked them to find out what sort of insurance they would need as a newly married couple buying a condominium.

Though Stern Marketing wouldn't release the names of the banks contacted, the company confirmed that 20 of the 30 largest banking companies were part of the study and that 75 bank salespeople were contacted.

The survey also found that, even when front-line employees passed on an insurance inquiry to a licensed agent, none of the mystery shoppers ever received a follow-up call.

Kenneth Reynolds, executive director of the Association of Banks-in- Insurance, a Washington-based trade group, said he is particularly disturbed by this finding.

"It seems to me we have an execution failure, and someone is going to get executed as a result of it," he said.

Many banks have work to do, he said, but these results do not reflect on established players like Norwest Corp., Minneapolis, or BB&T Corp., Winston-Salem.

Whether the inquiry was made by phone or in person, Ms. Stern said, "the confusion was the same." In one case, a "shopper" asked for insurance information and was never directed to a nearby stand stuffed with insurance product brochures, she said.

Still, a few bright spots shone out. One bank in California followed up on a customer inquiry with an overnight package, Ms. Stern said.

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