Magazine article American Banker

Va. Group Points Way in Insurance for Small Banks

Magazine article American Banker

Va. Group Points Way in Insurance for Small Banks

Article excerpt

Smaller banks seeking a piece of the insurance sales pie may have a business model in the Virginia Bankers Insurance Center.

The 67-member consortium of community banks, established in July 1999 to help community banks market insurance through agency acquisitions, has announced its first such deal and says more are on the way.

The group's first purchase would bring it the Blue Ridge Insurance Group and an affiliated outfit, the Ewald-Lester Life Agency of Wytheville. The deal was announced Wednesday and is expected to close in September, with cross-sales for the consortium's members to begin right away. Financial terms were not disclosed.

"What you have here is a bunch of small banks that could never buy an agency on their own finding a way to compete by forming alliances," Carmen Effron, president of C.F. Effron Co., a consulting firm in Westport, Conn., said of the consortium.

In a similar small-bank alliance, members of the Pennsylvania Bankers Association, of Harrisburg, Pa., can market insurance through an alliance the group's for-profit PBA Services Corp. subsidiary has with Bisys Insurance Services. Bisys supports these marketing efforts with information from its Web site and advice from experts the bankers can contact by phone.

Bruce Whitehurst, chief administrative officer of VBA Management Services, a for-profit subsidiary of the Virginia Bankers Insurance Center, said: "We want a platform of agencies in place. Right now, all of our members can expect to tap into the back-room support in Wytheville. But we still need to buy more agencies in order to offer face-to-face assistance to banks across the state."

He would not say when any further deals might be announced.

Blue Ridge and Ewald-Lester offer personal and commercial property and casualty insurance, as well as life and health lines through a staff of about 10 agents. …

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