Shareholders of two insurance companies affiliated with International Bank of Washington approved a merger that will create a $550 million insurance business, the two companies announced yesterday.

United Services Life Insurance Co. will issue 2 million shares of new stock to acquire all the outstanding shares of Bankers Security Life Insurance Society of New York.

The two insurance companies, which share offices and some facilities at 1701 Pennsylvania Ave. NW, will continue to operate separately, said Leslie P. Schultz, president of United Services.

Under the plan approved by shareholders of the companies at meetings in New York on Monday, each share of Bankers Security will be exchanged for 1.5 shares of United Services Life.

The transaction is worth about $30 million, based on 2 million new shares of United Services stock, valued at $15 a share. Before the merger was approved, Bankers Security shares traded at 21 3-8 bid, 22 1-8 asked, on the over-the-counter market.

Bankers Security shareholders who dissented from the merger will be entitled to sell their shares for cash. Valuation of the shares for cash. Valuation of the shares hasn't been determined, but is expected to be close to the recent selling price of the stock, a spokesman said.

Fewer than one percent of the shareholders asked for cash, and 74 percent of the Bankers Security shareholders and 82 percent of the United Services investors voted in favor of the merger, the companies said.

International Bank owned about 30 percent of the stock of United Services and 35 percent of Bankers Security and will own about 32 percent of the merged company.

United Services is the parent of two life insurers, United Services General Life Co. and General Services Life Insurance Co. Both specialize in selling life insurance to military personnel and civilian employes of the Defense Department.

The merged companies will have combined assets of $550 million with more than $7 billion of life insurance in force.