More banks in the Washington area are expanding their portfolios of insurance products, in an attempt to boost revenue at a time when income from fees is declining and there is lukewarm demand for loans.

There are 28 banks with branches in the Washington area that offer insurance products, according to SNL Financial, many of which have broadened their portfolios in the past year. Most banks act as brokers, partnering with third-party agencies to mitigate underwriting risk and collect commissions.

Insurance brokerage accounts earned banks $13.3 billion in 2010, a 7.9 percent increase from the prior year, according to the annual Michael White-Prudential Bank Insurance Fee Income Report.

“Banks are re-examining their business models and product offerings because new and proposed consumer regulations will eliminate many of the traditional sources of bank income,” said Robert C. Seiwert, senior vice president of the American Bankers Association’s Center for Commercial Lending and Business Banking.

Seiwert pointed out that most banks have long offered credit insurance, which pays off debts in the event of death. Banks in the area started building upon that product in the wake of the Gramm-Leach-Bliley Act in 1999, which eased restrictions on other lines of business, said Bruce Whitehurst, president of the Virginia Bankers Association.

“There are a good number of community banks that have acquired insurance agencies and gone into the general insurance business,” he said.

Sandy Spring Bank, he noted, has one of the longest track records of folding insurance agencies into its portfolio. In the past decade, the Olney bank has acquired Chesapeake Insurance Group, Wolfe & Reichelt Insurance and Neff & Associates, creating an extensive platform.

“We’ve been aggressively hiring new talent to expand and cross sell our insurance products,” said Lou Caceres, executive vice president of Sandy Spring Bank. “Just a couple of weeks ago, we expanded the line to include employee benefits.”

All told, the bank offers eight insurance products, including medical malpractice, through its agents. Those product lines generate 12 percent of non-interest income for Sandy Spring.

“Loan growth has been soft and insurance is a great way to diversify non-interest income,” Caceres said.

He pointed out that although premiums have slid in the past few years, experts anticipate growth in the face of recent disasters.

For its part, TD Bank, with 39 locations in the area, recently expanded its insurance line to include consumer protection products, such as identity theft and travel insurance. The Toronto-based company entered the insurance market 12 years ago and now counts more than half a million customers. Insurance brokerage accounts for less than 1 percent of revenue at TD in the United States.

“We’re looking to grow and make it a larger percentage, but we haven’t set any targets like some of our competitors,” said Joseph Fico, president and chief executive of TD Insurance. “We want to expand with a thought towards what are we capable of handling without jeopardizing the quality of the customer experience.”