To know how an insurance agent earns, you must be aware of their mode of work. Based on how they work, insurance agents are broadly classified into two types:
- Captive agents - Those who represent a particular insurance company.
- Independent agents - Those who sell insurance products from various insurance companies.
How much do the Captive agents earn?
Captive agents are employees of an insurance company and usually have fixed wages. The initial few months would be the training and learning phase for such an agent. Thereafter, the insurers usually set a target for each agent which has to be fulfilled within a pre-determined time period. According to his or her performance, his or her salary gets revised. There might even be a scope of earning performance bonuses, after the agent meet the target. The salary structure usually depends on a number of factors like the location, the company etc.
TopHow much do the Independent agents earn?
The independent agents represent multiple companies. They don't get a fixed remuneration from the insurance companies. They usually receive a percentage commission from the insurer, which depends on the amount of insurance they sell. Moreover, revenue is only generated on sale of new policies. Thus, to earn more, the agents need to sell more insurance policies.
TopWhat is the range of income?
The average income of an insurance agent is around $62,970 for a year, as the May 2011 reports of the Bureau of Labor Statistics have pointed out. However, since the individual income is generally based on the commissions earned, skilled agents having a large number of clients can earn much more than the BLS mean. The yearly income of around 50 percent of the agents ranges from $33,850 to $72,490, with the experienced ones earning as high as $115,300 on an average per year or even more than that.
| Employment | Annual mean wage | Annual median wage |
|---|---|---|
| $3,21,780 | $62,970 | $47,450 |
| Area Names | Employment | Annual mean wage | Annual median wage |
|---|---|---|---|
| Arizona | $6,390 | $51,980 | $40,750 |
| California | $23,890 | $75,140 | $59,240 |
| Florida | $26,940 | $59,420 | $46,530 |
| Kansas | $4,070 | $56,010 | $45,130 |
| Nevada | $2,250 | $51,580 | $35,640 |
| New York | $18,580 | $74,890 | $57,180 |
| Texas | $26,490 | $57,820 | $40,630 |
| Washington | $5,830 | $54,710 | $46,770 |
How much can be the agent commission?
The independent agents working for the insurance companies usually earn from the commissions after each policy sale. The agent compensation is usually paid only for the initial year of a new policy. The agents selling homeowner's insurance and auto insurance receive around 10 to 15 percent commission on the first year's policy premiums. The allowed compensation depends on the insurers though, and can be as low as 8 percent or as high as 15 percent. Life insurance agents earn a lot more, typically in the first year only. They usually receive most of the premium that the policy holder pays in the first year, or even all of it at times.
TopIs there a scope for earning more?
Apart from the standard commissions which solely depend on each individual agent's performance, the insurance agents have the scope of earning more if the client renews the coverage. The renewals commissions typically range between 2 to 5 percent for each policy.
Along with that, any insurance companies also offer year-end bonuses and non-cash rewards like trips and prizes for the insurance agents.
TopReading discussions & reading
- Qualifications you need to be an insurance agent
- How to become an insurance agent
- Can you make millions as an agent?
- What are the commission opportunities of an agent?
- What makes insurance agents click in the industry?
Posted: Thu Jun 30, 2011 05:31 am Post Subject:
if the captive agents are unable to reach the target will they loose their job?how to collect people for accepting the policies?
Posted: Fri Jul 22, 2011 10:07 pm Post Subject: inof
Hi Si, I am working on my insurance class/license, I like to know if I want to sell multiple companies or any companies insurance can I do that or there is any restriction, I would appreciate if you can help me understand this because I am stuck with one, there is know way we can offer clients competitive rates etc.. THANKS
Posted: Wed Sep 14, 2011 09:08 pm Post Subject: What happens when the agent dies?
Does the surviving spouse continue to receive the commissions?
Posted: Tue Dec 20, 2011 03:37 am Post Subject: Texas
I'm wanting to sell in Texas. I'm thinking about selling Health and Life & Auto. Can I just open my own office and sell these type of policies with out being under someones thumb? If so what type of license would I need to be independent in Texas? Also how do you get with insurance companies to sell their products?
Posted: Tue Dec 27, 2011 09:08 pm Post Subject: insureance
hey my name is beau how much does insureance agent are broker make yearly
Posted: Thu Feb 16, 2012 11:35 pm Post Subject: How manys years of schooling is required?
How many years of college is required to be an insurance agent? What classes are required?
Posted: Wed Feb 29, 2012 12:04 pm Post Subject: oHhrQClvcjXw
A lot. More today than a year ago.Because of Obamacare, no cnpmaoy in America offers stand alone children's health insurance.Why? Obamacare dictates that it is guaranteed issue, without rate ups, regardless of health. Therefore, there is no reason to purchase it until there is a claim needing to be paid.That's not health insurance. That's a confiscatory tax on health insurance companies. Fortunately, they aren't slaves yet, so they exercised the F U clause in the contract with the purple bellies from Washington and just refused to do business where they are guaranteed to lose money.How do you fix the problem of un- and under-insured? By making health insurance affordable.How do you make it affordable? By removing ALL government mandates, loser pays tort reform, encouraging competition between providers (enforce existing anti-trust laws), eliminate the AMA monopoly on billing codes, and eliminate the connection between employment and health insurance.Do these things and we'll see health insurance cost less than auto insurance. More people will be covered, more people will be healthy.
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Posted: Fri Apr 27, 2012 09:01 pm Post Subject: Is this Insurance Producer Offer Decent?
I have extensive B2B sales experience, but have been offered a position for an insurance company that is it's own brokerage and represents about 10 different lines. They made me an offer of a base of $55,000 for the first year and will pay for the training and my licensing. This company focuses on commercial property and casualty for businesses that pay a minimum premium of $50,000 per year. The commission structure they are offering is 40% for new contracts and 25% for renewals. The base salary is reduced by 1/3, the following year (in the thought that the commission will make up for it) and another 1/3 in year 3 so that it is fully commission based. My question is, does this seem like a good opportunity to make a very good income with a lot of hard work and tenacity? I will be completely new to the industry and appreciate any and all guidance. Thanks so much.
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