WHITE SULPHUR SPRINGS, W.Va.–Some in the insurance industry maybelieve banking and insurance don't mix, but executives at twomajor insurance brokerage firms owned by banks have apparentlyfound plenty of support for the entrepreneurial spirit that drivesbrokers.

They discussed the success of their enterprises with NationalUnderwriter last week during the 94th annual Insurance LeadershipForum of the Council of Insurance Agents & Brokers heldhere.

Interviewed were David J. Zuercher, chairman, president andchief executive officer of Wells Fargo Insurance in Chicago; SamuelL. Jones, president and CEO of ABD Insurance in Redwood City,Calif., which was acquired by Wells Fargo at the beginning of thismonth; and H. Wade Reece, president, insurance services manager forRaleigh, N.C.-based BB&T Insurance Service Inc.

Both Wells Fargo and BB&T are considered to be among the top10 insurance brokerages in the United States. In terms of brokeragefee income produced by banks, they placed second and third behindCitigroup in the first quarter of this year, according to a reportfrom Michael White Associates Bank Insurance Consultants (see NUOnline News Service, “Bank Insurance Brokers Quarterly Fee IncomeHits $1.3B,” for July 17). Wells Fargo stood in second place with$357 million in fee income, and BB&T was third with more than$195 million.

Wells Fargo Insurance is owned by the San Francisco-basedbanking institution Wells Fargo and Company. It became a majorbrokerage player in 2001 when it acquired Chicago-based Acordia,which changed its name to Wells Fargo this year.

Mr. Zuercher said Wells Fargo initially kept the Acordia name inplace because of its brand power with East Coast clients. Whatchanged was Wells Fargo's national growth and the producer'sinsistence that the power of the parent's name was gainingstature.

There was also an impression among some clients that the firm'sreluctance to adopt the parent's name was a sign the brokerage armwas either not healthy or was in line to be spun off, he said.Adopting the name, he explained, was aimed at dispelling thoseimpressions and was a further indication of the parent's intentionto continue to grow the business.

“The San Francisco office wants to grow and not see a decline inthe brokerage business,” he said, adding that the name change alsoindicates insurance will fall under one umbrella for the entireenterprise.

With the addition of ABD, he said, Wells Fargo will now move toexpand its risk management services and grow its brokerageoperation in the Western region. ABD also brings a strong benefitsoperations to Wells Fargo.

“What keeps customers up at night is the cost of benefits,”noted Mr. Jones, and being a part of Wells Fargo will now bringthose solutions into the fold where clients may have had to shopfor help elsewhere.

ABD is no stranger to working with banks as it was part ofGreater Bay Bancorp prior to the acquisition.

Over at BB&T, insurance has a long history, explained Mr.Reece. A part of Winston-Salem, N.C.-based Branch Banking &Trust Corporation, the insurance business at the company began in1922 and has remained a “core business” since then, responsible for13 percent of total revenues for the company and over half of itsfee business.

“Banking and insurance started in North Carolina,” said Mr.Reece, noting that BB&T developed a decentralized,entrepreneurial spirit in order to compete in “a land of giants”with some of the largest commercial banks in the nation that beganin the state.

“For us to exist and thrive, we had to focus on beingdifferent,” he observed.

Half of BB&T's business is in midsize accounts, personallines and benefits business. The remaining half is split betweenlarge accounts and wholesale brokerage dominated by CRC InsuranceServices Inc.

He said one advantage the firm has is discipline among all ofBB&T's sales force to seek opportunities by viewing the broadpicture instead of having a narrow focus.

“Plenty of people have relationships with our parent and not aninsurance relationship,” said Mr. Reece. By cross selling bankingand insurance products and services the aim is to get customers whostay with BB&T for the long haul.

For both Wells Fargo and BB&T, their plans call for futuregrowth through a combination of cross selling and acquisition.

Mr. Zuercher said the aim is to grow and become “more relevant”to Wells Fargo as a whole in terms of revenue and for insurers tosee the firm as a “strong distribution channel.”

Mr. Reece said BB&T will continue with its current businessstrategy and make acquisitions, saying the company hopes this willbe a “banner year.” He said the firm will also “build out” theproduct and specialties that CRC offers as part of a long-termstrategy for growth.

“We take a family approach [to integration],” said Mr. Reece.“We keep the fire alive and keep working.”