Jim Campbell has some news for bankers who think insurance agents spend too much time on the golf course and too little in the office - agents are not that fond of bankers, either.

"The agent thinks a bank doesn't understand a customer's needs," said Mr. Campbell, senior vice president of Reagan Consulting Inc., an Atlanta firm that brokers bank-insurance agency deals. "The agent thinks banks sit around with products on their shelf, waiting for people to come in and buy them."

However, as more banking companies buy agencies, insurance executives say that bankers and agents need to dispel the negative images and learn how to work together.

Agents resent the bankers' image of them - especially when a banking company buys an agency, Mr. Campbell said.

If a bank changes an agency's dress code, its office hours, and the basic way the agents do business, the deal "will blow up," he said.

Insurance agents "have a relationship-driven business, and they think banks aren't very good at that," he said. "Once a bank buys an insurance agency, it had better understand the business before it gets too involved."

Of course, a bank should not leave an agency entirely alone because that would defeat the purpose of the acquisition, Mr. Campbell said.

Banks do not buy agencies "just because the to-do list of the CEO was to get into the insurance business," he said. "Or at least I hope that's not why. That's stupid. Banks buy agencies so that they can cross-sell, and that doesn't happen automatically. That's where trust and cultural issues need to be tackled."

John Queirolo, president and chief executive officer of Webster Insurance, a division of Webster Financial Corp. in Waterbury, Conn., said he has spoken with many insurance agents who had disastrous relationships with the banks that bought their agencies.

"Some agents think banks are not flexible and too passive in sales," Mr. Queirolo said. In some cases, the agents' fears were realized when banks bought their agencies, he said. "Once they were purchased, they waited for some kind of communication from the bank and didn't hear anything."

When Webster bought his Westport, Conn., agency, Damman Insurance Associates, in June 1998, Mr. Queirolo said, the new parent immediately fostered relationships between its bank and agency employees. "They found out we weren't used car salesmen," he said. "But even then, it took a couple of years for us to reach our potential."

David Holton, president of Wachovia Insurance Services in Winston-Salem, N.C., agreed that building trust immediately averts major cultural clashes.

In September, Wachovia Corp. bought its second insurance agency, DavisBaldwin Inc. of Tampa. Wachovia's bankers were introduced to the agents soon after the deal closed so that they could get to know each other, he said.

"You can't just send out a memo telling your corporate bankers that insurance is now on the menu and, if you have an interested client, call such and such a number," Mr. Holton said. "That's not going to work. We put together a two-hour overview with our bankers, letting them know who the agents were, what lines of insurance were available, showed them that the agents were relationship-driven, just like them, and then had them meet each other."

Cross-selling can only begin after the bankers' and agents' myths about each other are extinguished, Mr. Holton said.

Wade Reece, president of BB&T Insurance Services Inc. in Raleigh, N.C., said that though letting agents and bankers get to know each other personally is a good idea, the organization must have strong sales discipline for cross-selling to work.

"The people inside have to see that this is a service business," said Mr. Reece, whose company has bought more than 50 insurance agencies and become the 11th-largest insurance agency in the country, according to Business Insurance magazine. "If you want to serve your clients at a higher level," he said, "you'd better understand the customer's needs. That's what matters."

"Management has to be clearly committed to entering the insurance business. There is a difference between being committed to a business and wanting to be in a business. If all you want is to be in the business, you'll always sit around wondering why it hasn't worked," Mr. Reece said.

Mr. Holton said the real challenge is getting bankers to understand insurance products. "We had bankers who thought insurance was not difficult because they bought insurance and figured, 'How difficult was it to sell?' Well, then they see the details of a workers' compensation program, and they're lost."

Wachovia's insurance agents gave the corporate bankers a "cheat sheet" - a list of questions that should be asked when discussing specific lines of insurance, he said. "That, too, is part of the relationship-building process."

Mr. Campbell, the deal broker, said another potential pitfall in bank-agency acquisitions is for the bank to recklessly change the agents' compensation plan.

Mr. Holton agreed but said that Wachovia has successfully changed the compensation structure for its agents. When agents generate their own business, they are paid the same commissions as they were before the Wachovia deal, he said, but they are paid less for sales referred by a banker.

Still, insurance agents would rather work on referred sales, he said.

"The hardest part of the agents' job is when they have to prospect - where they pull out the phone book and start from scratch," Mr. Holton said. "When the bank side gives them a lead, the hardest part is bypassed. The relationship is already established because of the Wachovia name. The agent already knows what lines of insurance the client needs. All that has to be done is tailoring the product for the client, which is easy work for a good agent."

Mr. Queirolo said Webster did not change his agency's compensation plan, in which agents are paid less for referred sales than those generated from scratch. "A referral is a referral, whether it's from the bank or another insurance agent," he said.

On the plus side, Mr. Campbell said, banks that tinker with an agency's financial operations can make improvements. Banks could teach many agencies how to run a tighter financial ship, he said.

"Agencies tend to do a bad job with financial management," Mr. Campbell said. Though the agencies are usually strong sales organizations, often they are not good at handling internal operations such as managing technology and maximizing staff resources, he said.

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