June 19 (Bloomberg) -- Lincoln National Corp. flew top insurance agents and company executives to a Hawaiian resort the week before accepting almost $1 billion in U.S. bailout funds, two people with knowledge of the trip said.

An event schedule and other materials given to agents who went on the trip to Grand Wailea resort on Maui were printed on the letterhead of ITAGroup, the firm that calls itself “a full- service performance improvement company” on its Web site. The hotel advertises rates from $369 a night.

Financial firms have roused public ire by funding conferences and bonuses after posting record losses and tapping Treasury’s Troubled Asset Relief Program to stay afloat. Congress has passed pay curbs and the government has demanded budget cuts including the cancellation of a private-jet purchase at Citigroup Inc.

“Lincoln is committed to providing continuing education events and rewards” for agents, Laurel O’Brien, a spokeswoman for the Philadelphia-based insurer, said in an e-mail today. The event in Hawaii allowed Lincoln to fulfill its “obligation to our top distribution partners.” She said the event was for independent contractors, not company employees.

Lincoln, which has been unprofitable for two straight quarters, held a pair of four-night trips from June 6 to June 14, each attended by more than 100 salespeople, the two people said. The second conference ended the day before Lincoln announced it would take about $950 million in U.S. funds. Grand Wailea generally doesn’t comment on clients, said Christina Yumul, a spokeswoman for the hotel.

Providing Incentives

Insurance policies in the U.S. are often sold by independent agents who help customers choose among products from different carriers. Trips are used by many insurers as an incentive to salespeople.

Conferences “have a value that goes beyond just compensation,” Steven Schwartz, an analyst with Raymond James Financial Inc., said in an interview. Agents “are motivated to sell in part due to the public nature of the awards system.”

Insurers have reported losses and profit drops over the last 12 months as the financial crisis pushes down the value of investments backing policies. American International Group Inc., the insurer saved by four bailouts since September, said last year it would cancel most planned meetings, and Amsterdam-based ING Groep NV, which received a capital injection from the Dutch government, eliminated some conferences at its U.S. business.

Lost Jobs, Homes

“We wanted to be sensitive to the plight of many Americans who had lost or may lose their jobs or homes,” Phil Margolis, a U.S.-based spokesman for ING, said in an e-mail today. “These events are critical to our relationship and should be reconsidered when the environment stabilizes.”

Lincoln offers getaways annually as a reward for top sellers, the two people said. This year’s gathering scaled back on recreation activities, entertainment and meals, they said. Lincoln broke with tradition this year by not issuing badges with the company’s name and not printing agendas on its own letterhead, the people said.

A document titled “NOW THAT YOU’RE HERE...” instructed attendees to “mention that you are with ITAGroup” when requesting discounts for resort activities and renting beach equipment. O’Brien of Lincoln didn’t immediately reply to questions about the use of the company’s name.

Government Aid

Lincoln executives told agents on the trip that the company had enough capital to survive and that government aid would be a buffer if the recession deepened, said the two people, who declined to be named because the trips weren’t made public.

O’Brien said Lincoln reduced the number of events it’s involved with because of “difficult economic times.”

Robert Dineen, chief executive officer of Lincoln’s advisory business, spoke in a welcome address, and David Berkowitz, senior vice president of Lincoln Financial Advisors, also attended, according to an agenda and one of the people. Lincoln CEO Dennis Glass, who was listed in company materials among the attendees, didn’t appear, the two people said.

Air travel was in coach and Lincoln offered to pay for the trips of the agents’ spouses, the people said.

To contact the reporter on this story: Andrew Frye in New York at afrye@bloomberg.net.

Last Updated: June 19, 2009 19:20 EDT