Nontraditional Services Build Trust

Meet more of your members’ needs by offering insurance and investment services.

May 28, 2013

In the late 1990s, State Employees’ Credit Union (SECU) recognized that if we wanted to maintain members’ trust, we had to go beyond checking, shares, certificates, and loans. We also had to offer “nontraditional” services such as insurance and investments.

In 2000, we started offering individual term life insurance to members through our call center. Since then we’ve tweaked our offerings and expanded our network to include more than 1,500 licensed agents who offer whole life and term life through our branches.

Our licensed agents are all salaried credit union employees who receive no commission or incentives for their work. The commissions received from the insurance companies become part of our fee income. It allows us to offer these products and meet members’ insurance needs.

By focusing on employee education instead of employee sales, we made insurance another service our employees proudly offer to members in addition to car loans and money market accounts.

In 2003, through our branches we added personal lines (auto, homeowners, and miscellaneous). In 2007, we added long-term care and health insurance. Now, we’re providing services to our members with more than 17,000 outstanding policies.

In 2002, our members began asking for help with investments. So, we became part owners in a broker-dealer By 2007, we incorporated our own credit union service organizations for investment advisory and brokerage services. The move allowed us to advise our members concerning investment services, and better control the products and pricing.

We focused on the “not-yet-wealthy” investors by offering a low opening balance ($250) and extremely low fees. Again, we decided to use our own employees and educate them on how to offer these additional services.

Currently, we have more than 300 active representatives with Series 6, 63, and 65 licenses. Another 95 are in the process of obtaining licensing. We have 5,300 open accounts and manage nearly $200 million in assets.

Our program is simple and easy to understand. We focus on Vanguard funds, which are indexed, well-diversified, and low-cost. Members know our financial advisers are objective and receive no incentives or rewards.

Now, we also offer retirement planning and financial planning for future events. We help members plan for college expenses for their children or grandchildren.

In January, SECU incorporated a life insurance company and became licensed to sell life insurance and fixed annuities in North Carolina. SECU became the first policyholder of an employer-sponsored group term life insurance policy for SECU’s 4,500 employees, their spouses, and their dependents.

We plan to issue simplified individual whole and term life through our branch network for members at competitive prices. Our licensed agents will offer deferred fixed annuities to members looking for tax deferral and immediate fixed annuities for those seeking a lifetime income stream.

SECU offers $1,000 worth of free group life insurance to those in our Fat Cat (ages 0-12) and Zard (ages 13-19) programs. Supplemental group life insurance will be available for these youth groups for a low annual premium.

SECU is the primary trusted financial institution to most of our 1.8 million members. That trust extends beyond the traditional services, as we become more involved in offering nontraditional services. By focusing on what’s best for the member and not on “making the sale,” we continue to build on the trust members have in SECU.

If you focus on your members’ financial success, you’re also focusing on the success of the credit union. They aren’t mutually exclusive.

SUE DOUGLAS is chief operations officer for State Employees’ Credit Union, Raleigh N.C., and chair of the CUNA Operations, Sales & Service Council. Contact her at 919-839-5008.