Individuals looking to either begin or change careers should give serious consideration to life insurance sales. Being a life insurance agent is part of a short list of jobs with minimal barriers of entry that still allow you to work closely with people, generate an incredibly positive impact, and potential to make very high earnings.
What is it Like Being a Life Insurance Agent?
In order to calculate how much you will make as a life insurance agent, it is important to understand what type of job it actually is. While details will vary state-to-state based on laws and regulations, an insurance agent is, in essence, a specially licensed salesperson. The licensing process typically requires background checks, training, and passing an exam in order to ensure that all agents are both informed and trustworthy. Beyond that, there are no other requirements; you can become a life insurance agent without a college degree or prior experience.
Most life insurance agents are independent contractors. The first step after being licensed is to sign-up with life insurance carriers so you may write and sell their policies. Some agents will contract with a single carrier, while others will contract with multiple so that they may provide more options to their clients.
After contracting, a life insurance agent’s job is very straight-forward. They must contact individuals who reside in the state(s) that correspond to their insurance agent, share policy information with them, and help them make an informed buying decision. For most families, life insurance is a powerful tool to protect against truly terrible circumstances, which is why many life insurance agents feel proud and motivated to work.
Working With IMOs
An IMO is an Insurance Marketing Organization. These are companies that can help independent life insurance agents in a variety of ways. That may mean assistance in getting licensed, getting contracted, building an agency, or even finding families to work with. Choosing to work with the right IMO can drastically change the experience of a life insurance agent. For example, if your IMO offers leads, you will not need to cold call or turn to family and friends in search of sales.
Life Insurance Agent Compensation and Salary
So, how much do life insurance agents make? In most cases, that will depend on how many policies they write. Therefore, the first detail to look at is compensation rate.
Compensation or comp will vary by IMO as well as carrier. Unfortunately, there is a wide range of comps offered in the life insurance industry and agents who choose IMOs on the lower end are often (though not always) misled or misinformed. While one IMO may offer 40% comp, others indeed offer 140%. While there are other details to consider, this will naturally influence how much the agents make.
Additionally, other factors to consider are if the agent is working full-time or part-time, if they are receiving renewal payments on their sales, and the sorts of policies they are writing. Data suggests the median yearly earnings of insurance agents is around $75,000, but some IMOs will average higher than that. Family First Life, our IMO, averages over $100,000 in earnings for our life insurance agents.