We know insurance is a necessity wherever you reside and that it’s particularly relevant in countries that don’t provide adequate cover for unemployment, healthcare. Being an insurance agent is rewarding with excellent commissions and more flexibility than other jobs. In this blog article, we look at the basics of the insurance agent role.
There are not a lot of jobs that offer new recruits an opportunity to earn a substantial amount of money right away. Sales roles are particularly attractive because they reward the salesperson based on the number of sales made. For example, if you sell more you get paid more, and that’s the attraction, how much money you earn is up to you, and insurance agents are salespeople, so they are rewarded on the number of insurance policies they sell.
There is more to the role than just having the gift of the gab you’ll need to perform assessments, evaluate needs, develop strategies, and discuss options, all for the benefit of your client and their interests.
While your role to sell insurance, you do need to make sure what you’re selling is appropriate for the policyholder. Therefore being an insurance agent is not just another sales job, you’re also an account manager and an advisor. Your clients will rely on you to give them accurate information on the pros and cons of insurance for their specific needs.
Types of Agents
There are generally two types of insurance agents, freelance and captive.
As a captive agent, you’re working for one insurance company. If you’re used to being an employee, then this is how you should operate. Plus when you work for a business, you can work your way up and into other roles, including team leadership and management. You’ll also understand the company more thoroughly and have the confidence to sell what they provide. You might also have more flexibility to offer more competitive rates.
Independent or Freelance
Just like freelancing for any profession, for example, a website developer, graphic artist or accountant, you can freelance as an insurance agent. You may be an independent sole trader aka self-employed or operate under an incorporated company entity.
However, you do it, you can work for different carriers and sell insurance for them. In this role, you’re a broker, selecting the right insurance provider to meet your clients’ requirements. You have more scope to offer competitively priced insurance policies.
Most agents earn five to ten per cent of the value they are able to sell. Also, they can get up to ninety per cent of the policy’s value in the first year. And get the five to ten per cent commission in the subsequent years for each time their client renews their policy.
Annually, the earnings of agents vary significantly from $18,000 to $180,000. Since it mostly depends on their ability to sell, location, and the financial climate.
There are different requirements for each state, but there are common items that an aspiring agent should comply with. Generally, you don’t need a college degree, but it ultimately depends on the hiring company and their preferences. States also require agents to get an insurance license after you’ve taken your pre-license course. You will also need to take an exam on the speciality or the line of insurance you want to get.
There is also the FINRA Securities Licenses if you want to be a life insurance agent or financial advisor. This is because products tied to the stock market need federal level licensing.
Types of Insurance
There is insurance for nearly every facet of business and life, including life, property, business, car, health. You may find one type of insurance resonates with you and if so choose that over general insurance. If you like what you do, you’ll do better at it.
Being an insurance agent will more than pay your bills, and it’s a role that survives recessions.