Banks' income from insurance brokerage fees topped $3B in 3Q

Insurance brokerage fee income at banks hit $3.05 billion for the third quarter of 2009, up 11.7% from the year-ago period, according to the Michael White-Prudential Bank Insurance Fee Income Report.
JAN 26, 2010
Insurance brokerage fee income at banks hit $3.05 billion for the third quarter of 2009, up 11.7% from the year-ago period, according to the Michael White-Prudential Bank Insurance Fee Income Report. That’s the highest level in the last five quarters, according to the data compiled by Michael White Associates LLC. Bank-holding-company insurance brokerage fee income includes commissions and other fees a bank-holding company or its subsidiaries earn from insurance product sales, as well as referrals for credit, life, health, property-casualty and title insurance. Through the first three quarters of 2009, insurance brokerage fee income at bank holding companies totaled $9.1 billion, down 0.7% from the year-ago period. The study, based on data from 7,319 commercial and FDIC-supervised savings banks and 922 top-tier bank holding companies, was sponsored by The Prudential Insurance Co. of America’s individual life insurance business. Wells Fargo & Co. led the pack with $1.38 billion in year-to-date insurance brokerage fee income through the third quarter, up 5.34% from the first nine months of 2008. Citigroup Inc. came in second, with insurance brokerage fee income of $771 million for the first three quarters of last year, down 19.27% from the year-ago period. BB&T Corp. rounded out the top three, reporting $699.9 million in insurance brokerage fee income for the first three quarters in 2009, reflecting an 11.8% gain from the year-ago period. Improving fee income might have something to do with a softening market for property-casualty insurance, noted Michael White, president of Michael White Associates. Further, while some bank holding companies have exited the insurance business or changed to a savings-and-loan charter — which would remove them from the pool of banks in this study — there have been a few new entrants, which has helped offset the decline, Mr. White added. “While some bank holding companies have disappeared and exited from insurance, we have some new entrants with relatively substantial insurance operations,” he said.

Latest News

SEC to lose Hester Peirce, deepening a commissioner crisis
SEC to lose Hester Peirce, deepening a commissioner crisis

The "Crypto Mom" departure would leave the SEC commission with just two members and no Democratic commissioners on the panel.

Florida B-D, RIA owner pitches bold long-term plan to sell to advisors
Florida B-D, RIA owner pitches bold long-term plan to sell to advisors

IFP Securities’ owner, Bill Hamm, has a long-term plan for the firm and its 279 financial advisors.

Fintech bytes: Vanilla, Wealth.com forge new estate planning partnerships
Fintech bytes: Vanilla, Wealth.com forge new estate planning partnerships

Meanwhile, a Osaic and Envestnet ink a new adaptive wealthtech partnership to better support the firm's 10,000-plus advisors, and RIA-focused VastAdvisor unveils native integrations with leading CRMs.

Fiduciary failure: Ex-advisor who sold practice fined after clients lost millions
Fiduciary failure: Ex-advisor who sold practice fined after clients lost millions

A former Alabama investment advisor and ex-Kestra rep has been permanently barred and penalized after clients he promised to protect got caught in a $2.6 million fraud.

Why the evolution of ETFs is changing the due diligence equation
Why the evolution of ETFs is changing the due diligence equation

As more active strategies get packaged into the ETF wrapper, advisors and investors have to look beyond expense ratios as the benchmark for value.

SPONSORED Are hedge funds the missing ingredient?

Wellington explores how multi strategy hedge funds may enhance diversification

SPONSORED Beyond wealth management: Why the future of advice is becoming more human

As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management