EAST WINDSOR, Conn.-Credit unions in 2013 will do a better job of tapping the income opportunities that come with connecting lending and insurance, according to Jeff Chesky.
Chesky, chairman and CEO of Insuritas, a provider of outsourced insurance agencies, told Credit Union Journal it's time for CUs to think strategically about organizing their insurance products as a "permanent aisle" in their stores. He said most CUs continue to treat insurance as an "afterthought" to their core business, offering a "confusing" set of products through third-party vendors and using uncoordinated distribution methods. The net result, said Chesky, is member confusion, poor sales results and weak financial outcomes.
"Credit union CEOs are now realizing that every time they approve an auto, home or business loan, they are creating an insurance buyer-and that they are perfectly positioned to offer insurance coverage as a part of their core lending activities," he said.
This opportunity is supported by recent studies that Chesky said found more than 98% of the information collected on loan applications is the same information needed to generate an insurance quote.
"This allows a credit union-owned insurance agency to offer a member an opportunity to truly save time and money on their insurance purchases while applying for their loan," he said.
The Best Combination
In addition, Chesky said credit union CEOs are reacting to recently published research from Deloitte that 40% of consumers do not trust local insurance agents to give them the best combination of price and coverage, and that another 40% of consumers do not trust insurance carriers to provide them with competitive quotes.
"Going forward, antiquated direct mail, teller action display and kiosk signage-based insurance product distribution models from old generation third-party partners will continue to create headwinds for credit union CEOs looking to reshape their insurance offerings from mono-product offerings to a turnkey insurance agency shopping experience," he said. "Legacy contracts, inventories of old products and coverages all will create obstacles for change, but visionary CEOs are insisting it is time to break from these legacy product and distribution models and to create a one-stop insurance shopping experience for the member."
For info: www.insuritas.com