Since 2000, when the Gramm-Leach-Bliley bill made it possible for banks to enter the insurance business, the selling world has seen an invasion of financial institutions, such as Wachovia and BB&T, who have bought insurance agencies or created their own to sell life, disability and other products.Now, the insurance industry seems to believe that turnabout is fair play. In addition to a number of insurance companies, including MetLife, State Farm and Allstate, that created their own banks several years ago, one firm, InBank, is going so far as to offer insurance companies "private-label banking," which executives say allows insurers to sell banking products without the attendant capital costs and regulatory responsibility.
"Insurance companies would like to cross-sell more products, increase their income and more fully meet their customers' needs," observes Michael White, president of Michael White Associates, a bank insurance consulting firm based in Radnor, Pa. "If the company sells life insurance, for instance, it can keep the assets under management."
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