The Laughlin Group of Cos. is kicking off an ambitious plan to market life insurance to banks' corporate and individual clients.
LifeMark, the company's three-year-old life insurance marketing subsidiary, will focus 100% on distributing life insurance through banks, said Paul A. Laughlin, chairman of the Beaverton, Ore.-based marketing firm.
"Life insurance has been sold successfully for years, but not through banks," Mr. Laughlin said.
He is aiming to change that. To that end, Laughlin Group will market life insurance using a sales force dedicated specifically to that product line.
The company previously used the same sales representatives to sell both annuities and life insurance. However, those representatives did not like spending the kind of time it takes to sell life insurance products, Mr. Laughlin said.
Salespeople will now tap areas such as banks' personal trust, private banking, and mortgage divisions to generate new customers. In the past, sales representatives were mostly cross-selling products only to certificate of deposit or annuity buyers.
The company is also putting more resources into educating potential customers.
"People are absolutely starving for financial education today," Mr. Laughlin said. "We're trying to make the bank into the informational and educational center of the community."
Another part of the initiative is helping banks tap into what Mr. Laughlin believes will be a high demand for nonqualified deferred compensation plans.
Recent legislation has reduced the amount high-pay executives can put into qualified plans, which allow for tax deductions of contributions. "Life insurance, because of its tax-deferred aspect, makes it the best choice for funding nonqualified deferred compensation plans," Mr. Laughlin said.
Though banks have not marketed insurance properly in the past, he said, they have certain advantages in selling these products.
"In most cases the client of the bank would rather deal with the bank than some (insurance) agent he's never dealt with before," said Donald G. Petrie, an attorney at LifeMark.
Mr. Petrie also gives estate planning seminars at Union Bank, San Francisco, one of two banks that have already signed on to sell Laughlin's life insurance products. Mr. Laughlin said he expects to land at least 11 more bank clients by yearend.
After eight months developing the life insurance marketing strategy, Laughlin Group hired three executives to oversee the effort.
Ned C. Ward, a 25-year veteran of the life industry, came on board as president a year ago. John Christensen, LifeMark's new vice president, was hired last month. And account manager James C. Dodge, who joined the company in October, oversees LifeMark's activities at $16.2 billion-asset Union Bank, a subsidiary of Bank of Tokyo.