Strong referrals from across the company, particularly from bankers, are lifting Comerica Inc.'s insurance brokerage revenue despite a soft property and casualty market, according to the head of the insurance unit.
"We are in a perfect storm in our industry right now," said Steven Turtz, a senior vice president and the national sales director for Comerica Insurance. "Bankers as a whole want more stickiness to their businesses, and insurance fits in very well with those customers."
The Dallas banking company's insurance brokerage fee income is rising. It was $7.9 million in the first half, according to the Michael White-Symetra Bank Holding Company Fee Income Report, versus $5.7 million in the first half of 2007.
"Comerica is really making good, steady progress," said Michael White, president of Michael A. White & Associates, a research and consulting firm in Radnor, Pa.
Comerica ranked 51st in insurance brokerage fee income among banks through the first quarter, up from 72nd a year earlier, Mr. White said.
"We're having a very, very good year," said Mr. Turtz, who recently projected that Comerica would earn as much as $12 million in premiums this year. The 2007 tally was $7.3 million, according to Mr. White's report.
Comerica has used training and incentives increse insurance referrals, said Mr. Turtz, who had been with Highland Capital Brokerage in Los Angeles and Wells Fargo Insurance before joining Comerica in July 2006. Bankers have been trained in everything from the sorts of products that Comerica Insurance offers to how to identify cross-sell prospects, he said.
The training has driven home that "every" commercial customer "buys property/casualty and group insurance through somebody," Mr. Turtz said. He said he joined Comerica as it was building its insurance business. He said part of elevating insurance to core-product status has been viewing bankers as "internal customers" and meeting their needs.
Eight months ago, for instance, Comerica Insurance created a business development officer position to improve communication between bankers and insurers. It is also using the bankers' feedback to bolster certain product areas, Mr. Turtz said. Four months ago Comerica Insurance hired Tom O'Connell, who had been with the French credit insurance firm Euler Hermes, to head its expanding credit insurance business. The line specializes in products for businesses, such as accounts receivable insurance.
"Our internal customers within the bank are telling us what their customers need," he said. "We'll look at where there are holes, and will add products and expertise that speaks the bankers' language."
Comerica Insurance has made trade-offs on the way to its success. Last year, it sold its life insurance agency, Professional Life Underwriters, which distributed through independent insurance agents and financial planners. Still, Comerica Insurance last year wound up with "a little over $5 million" in revenue, Mr. Turtz said, versus less than $4.5 million in 2006.
Professional Life Underwriters "did not align with our bank's philosophy," Mr. Turtz explained. Comerica now offers life insurance under the brokerage format.
Mr. Turtz acknowledged that the business has been affected, as have brokers in general, by lower prices for property/casualty insurance. But premiums have held up well in group-benefits products such as life, health, long-term-care, and disability insurance, he said.
By offering a wide product selection and "really analyzing customers' full insurance needs," Comerica Insurance has had steady revenue growth, Mr. Turtz said. Over the past three years it has expanded its insurance sales outside its original stronghold of Michigan. IDistribution partnerships with three insurers have allowed it to expand in Texas, California, Arizona, and Florida.