Providian Life and Health Insurance Co. is offering to pay clearing charges for bank clients that sell its variable annuity product.
Providian said it will cover the costs of processing its Providian Marqee Variable Annuity as long as banks clear sales transactions for the product through Philadelphia-based BHC Securities Inc.
"We are not telling the bank what product to sell the customer, but we are hoping this gives the bank an incentive to look at the Providian Marquee Annuity," said Mark Nerderman, vice president for financial institutions.
Mr. Nerderman said Louisville, Ky.-based Providian is the first insurance company to pick up the tab for clearing fees charged to banks.
"This allows us to increase even more the value-added service we provide to our bank clients," said Mo Miller, BHC's senior vice president for client services.
BHC said banks can save more than $50,000 a year with 10 transactions a day of the Providian product.
The Providian product consists of 12 investment options managed by big- name fund companies including Fidelity Investments, Dreyfus Corp., and OppenheimerFunds Inc.
Providian has been selling insurance products to banks since 1981 through third-party marketing firms. Providian Life is a subsidiary of Providian Corp., which holds $26.8 billion in assets.