M. Nasim Ali of SBLI USA Mutual Life Insurance Co. Inc. explains his marketing strategy by quoting a statistic: 40% of Americans have no life insurance.
"Those are the people we want to reach," said the executive vice president, marketing and sales for the New York-based company. "There's a reason why they don't have life insurance. They're ignored. The individual agent focuses on the upscale. It's a commission-driven business. That's the main reason why."
So SBLI targets the ignored, what Mr. Ali calls the lower- to middle-class. And he said, "The banks are a good way to reach them."
The $1.3 billion-asset SBLI predicts it will have sold $11.3 million of life insurance through banks when it closes its books on this year. And though it entered the bank-annuity market just in August, its target is $10 million of fixed annuity sales by yearend. It doesn't offer variable annuities.
The annuity sales are entirely in New York, but the company is in discussions with banks in states with large cities, including California, Texas, Pennsylvania, Florida, and New Jersey. The numbers so far are small, but SBLI USA is connecting with its target market, Mr. Ali said.
"This is about reaching the people that need to be reached," Mr. Ali said. "They are very concerned with their principal. They're very conservative with their money, and that makes a fixed annuity a good fit for them. They also need life insurance."
Among the New York financial institutions that sell SBLI's fixed annuities are Independence Bank, Staten Island Bank and Trust, Washington Mutual, and New York Community Bancorp, which operates a network of community banks in the New York area, including Queens County Savings Bank.
As part of its low- to middle-class focus, SBLI has Spanish-language application and all other policy forms filed with New York.
"Our Web site, customer service reps, wholesalers, they all speak Spanish," Mr. Ali said. "Now we're beginning a focus on the Asian market."
SBLI is not alone with its Asian focus. The New York-based insurance giant MetLife Inc. is also a big player in the Asian community.
"But, like everyone, they go after the more affluent," Mr. Ali said.
SBLI's strategy gives it a nice niche in the bank channel, said Bob Wick, a principal at Cramer, Wick & Associates, the bank-insurance consulting firm with offices in Davidson, N.C., and Austin, Tex. "This has been their market historically, and they are very good at it," he said. "The pure return is probably not worth the allocation of resources for some of the bigger insurance companies, and SBLI has filled the gap well.
"And they're right, there's still a great opportunity to grow because there's still a lot of uninsured people."
But SBLI USA is not the only one reaching for the historically uninsured, said Carmen Effron, president of the consulting firm C.F. Effron Co. in Westport, Conn.
"Liberty and CGU are two companies I know of that are also going after this market," Ms. Effron said. "SBLI has a tremendous marketing job ahead. They are very well known in New York, but outside of New York, Liberty and CGU have much bigger names. This isn't going to be a fast win for them.
"On the other hand, if they get the story of their success in New York out to the rest of the states they're targeting, they could do very well," Ms. Effron said.
SBLI's marketing campaign includes direct mailings, phone calls, and the Internet. Mr. Ali said direct mail leads to about 30% of its sales. Another 20% of sales comes from inbound calls to the call center.
The bank channel, at 40% of sales, remains the biggest distribution channel for SBLI. This is due in part to the company's history. It converted into a mutual company in 2000 when it also expanded into other distribution channels. For 60 years before that banks had been its only distribution channel.
SBLI USA is not related to Savings Bank Life Insurance Co. in Massachusetts, which also markets itself as SBLI.
