SAN DIEGO -- The legal battle brewing over banks' role in selling insurance was the big question on most people's minds at the Financial Institutions Insurance Association conference.

A record number of attendees flocked to the seaside conference last week to get an update on recent legislation governing insurance marketed through banks and to learn about strategic planning, marketing, and sales techniques.

Bankers already in the business shared their stories about making money from annuities, using technology to improve profitability, and compensating insurance salespeople.

|Get in There and Do It'

Regulatory gurus advised bankers to start selling insurance soon if they plan to get into the business at all. Pending legislation might end banks' opportunity to break into the business.

Last summer, a federal appeals court upheld a law allowing banks in towns with fewer than 5,000 people to sell insurance both locally and nationwide.

"If you're thinking of using this town-of-5,000 opportunity, I would get in there and do it," said Doyle C. Bartlett, general counsel of the Conference of State Bank Supervisors in Washington. "We don't usually put guys out of business."

Some banks, such as Detroit-based NBD Bancorp, are scanning maps in search of towns with 5,000 residents or fewer.

"We're exploring strategic alternatives in small communities," said Russell C. Browne, first vice president at NBD Retail Investments and Insurance, Farmington, Mich.

More than 2,000 commercial banks are now selling annuities, according to the financial institutions insurance group.

Some attendees came to the conference to test the waters before deciding whether to dive into the insurance business. "I'm just window shopping," one banker said as he ducked an oncoming vendor.

Others have adopted an aggressive strategy. Just three months ago, Wells Fargo & Co. launched a full-scale effort to beef up its insurance services unit, said David Stewart-Jones, vice president.

Wells Fargo started its program in Brisbane, Calif., "a town just south of San Francisco which, incidentally, happens to have less than 5,000 people," Mr. Stewart-Jones added.

Many who came to the conference alone were searching for potential partners. Maybe there's something in the air: In 1916, under the same turreted roof of the Hotel del Coronado, the future King Edward VIII met Wallis Spencer Simpson. Twenty years later, Edward gave up his throne to marry her.

For bankers looking to pair up with third-party marketers, Ronald A. Aalseth, president of Commercial Federal Insurance Corp., Wheat Ridge, Colo., recommended "finding one who understands your needs."

Annuity marketers such as Talbot Financial Services of Albuquerque, which has already linked up with Bank of America, Bank of Hawaii, Mellon Bank Corp., and others, were looking for fresh faces.

"I think there will be a lot more relationships for third-party marketers on the new frontier," forecasted Felice L. Larmer, senior vice president at Keycorp Insurance Management Group, Albany, N.Y.

In the corridors outside the conference, many bankers discussed salesmen's salaries in hushed tones.

What's the right amount to pay employees for selling insurance? At Boatmen's Bancshares, the average income for sales representatives is close $100,000, said Thomas Schwarz, a vice president at the St. Louis-based bank.

Investment salespeople's salaries are a problem at Commercial Federal Insurance Corp. "We tell them not to drive their Mercedes to work," said Mr. Aalseth.

The San Diego conference drew an unexpectedly large crowd of 271, including many walk-ins.

"It was absolutely record attendance," said Alice Berreyesa, administrative director for the financial institutions insurance organization.

The other good news, she noted, was the bankers outnumbered vendors, a rare occurrence at these events.

The trade group's next meeting is scheduled for April 10-12 in Washington, and Ms. Berreyesa said it will focus heavily on the regulatory side of the business. When in Rome ....

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