A large Virginia insurance agency is helping banks break into selling commercial insurance to midsize and large companies.

Richmond-based Hilb, Rogal & Hamilton Co., the seventh-largest U.S. agency, is selling commercial and personal insurance to customers of four superregional banks through its year-old subsidiary, HRH Financial Institutions Group of Pittsburgh.

Banks building an insurance business typically have ignored large commercial customers because of the scale and expertise needed to compete with dominant players such as Marsh & McLennan Cos.

But HRH, with a national network of more than 50 agencies, is used to dealing with the tight margins of the commercial line. And it expects the bank channel to account for a big chunk of its sales in commercial and personal lines.

"The opportunities (through banks) are huge," said Lane Williams, vice president at HRH Financial. "The industry is going in the direction of one- stop shopping - especially in financial services."

She said banks would be a significant portion of HRH's insurance sales in several years, but she declined to provide an estimate.

However, Ms. Williams did provide an example of HRH's bank business volume. One of the four banks makes 150 to 200 referrals a week to HRH, she said. Of those leads, about 15% result in sales, she said.

The unit has grown to 35 employees-from four in July - and is still hiring, she said.

Though most of its bank sales are in personal lines, she said, HRH believes commercial sales will be successful through its bank partners.

"We think we have the right idea to offer the multiple-carrier approach," she said. HRH offers insurance from all carriers, which customers like, she said.

However, building commercial sales is a three- to five-year process, she said.

Patrick Moore, a Cleveland-based consultant for banks and insurers, has worked with HRH. Despite the keen competition for large commercial insurance accounts, he said, it is not an impossible market to tap.

"That business used to stay with the same carrier, but now it's basically shopped every year," he said. "Companies look at price, underwriting services, and other issues in choosing such insurance."

A key ingredient for any company partnering with banks is the ability to integrate systems with the bank, and HRH has done well in that regard, he said.

Ms. Williams said HRH does face integration issues.

"The challenge in what we face is not unlike what others have faced," she said. "It's the merging of two cultures."

To promote the program to customers, Ms. Williams said, HRH is relying on bank referral programs, statement stuffers, and contact with mortgage applicants.

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