You can do this as a group activity or as an individual activity. I generally do it as a group activity.
Assign students a passage to read. Have students imagine they are newspaper reporters who are going to write a headline for this passage. What will they write? What headline will tell your readers the most important information in the fewest words? Give students a few seconds (I usually do 60-90 seconds on the timer) to write a headline. Share the headlines.
You could also give students a set of several passages. They should come up with "titles" for different set of verses, or they might summarizing what lesson is taught by specific verses. Have them write these "titles" in their scriptures.
If you're going to have all students share their headlines aloud, this works best in classrooms of about 12-15 students. My class of 16 is borderline too large for each person to share a headline. In large groups, you may ask for volunteers or cold-call class members to share their headlines. Don't be afraid to read over people's shoulders and ask some of the really great ones to share.
Invite students share why or how they chose particular words, phrases, or things to emphasize in their headline.