How much do insurance agents make?

by scottdwayne7 » Tue Nov 13, 2007 02:43 pm

Insurance agents can have a rewarding career, and more so, since nowadays individuals have recognized the need for having insurance protection. However, it's difficult to predict the exact earnings of an insurance agent. That is because, an agent's earnings depend on his client base and how much insurance coverage he can sell. Thus, the more you put your effort as an agent, the more policies you'll sell and the more will be your income.

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:

  1. Captive agents - Those who represent a particular insurance company.
  2. 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.


How 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.


What 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.


Is 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.


Reading discussions & reading

How much do insurance agents make? Do insurance agents make good money at all ?

Total Comments: 163

Posted: Sun Apr 12, 2009 03:51 am Post Subject:


He don't even have a website?

You're kidding us, right?

Posted: Wed May 20, 2009 03:28 pm Post Subject: Yeah, They get that in ALLOT of Forums!

You are not alone! Sadly enough, true! A bunch of agents out there trying to build a down line to make money off of others because they don't want to sell for themselves. They have a basic knowledge of the industry, and become their own "IMO" Idiot's Marketing to OTHERS"
"NGFGLLC" is on allot of other insurance forums pushing their crap on others.

Posted: Wed May 20, 2009 03:56 pm Post Subject: Ok, this is Great!

Great Great Stuff!

I am Proud to have others like you!
I too was subjected to a company doing that. Not going to name that Particular company (IMO) as it is still pending and charges have not been pressed as of today, it is still being investigated, Going on 5 months now. But I am sure the AIC, will be contacting them very soon! And they were churning a past employers business. And it was a "HUGE" company they were churning.
They were more than happy to run with this information....

Great Forum!
Hallelujah for Honest Agents!

Posted: Wed May 20, 2009 04:29 pm Post Subject:

You are not alone! Sadly enough, true! A bunch of agents out there trying to build a down line to make money off of others because they don't want to sell for themselves. They have a basic knowledge of the industry, and become their own "IMO" Idiot's Marketing to OTHERS"
"NGFGLLC" is on allot of other insurance forums pushing their crap on others.

LOL. Wow, the assumptions just keep on rolling don't they?
For your and others info, I have been an agent for many years. I have sold tons of policies. I found myself in the position to help other agents get the contracts they deserve that they can't get on their own. I help agents, I don't hurt them in any way shape or form.
So tell me, what would you rather have, the highest contract you can get or to go direct with a company on a lower contract? Would you rather be on contracts high enough that you can actually offer other agents very good contracts or be at street level?
You see, I've been the insurance agent that has been screwed over by uplines trying to make as much off me as possible. Since I've gotten to the position I have, I promised myself that I would never do that to agents and would offer them what they usually can't get anywhere else.
You should really find out more about me and what I actually do before you lump me into some big "IMO' pile on your list.
I do understand what you are talking about when it comes to certain IMO's and all, but I assure you, I don't play that game!
If you really want to find out what I do and a little more about me and what my philosophy is, you can contact me at your convenience.
Otherwise, please stop ASSuming you know about me.

Posted: Wed May 20, 2009 08:43 pm Post Subject:

Great-Stuff, Thanks for the kind words.

Over the past 15 years, I've always done my best to make a difference within an industry rot with moral and ethical decay, corruption, and illicit business practices. My investigations have led to fines and restitution in excess of $1.3 Billion and the permanent revocation of 13 insurance licenses. Very few things in life give me more pleasure than taking a bad agent (or agency) off the street.
Some things, however, still tend to confuse me. The case above, for example, involving Mr. King and a couple of agents who seem to be circling him like vultures, predisposed with reducing what he does for a living to something he should be ashamed of. These agents obviously know him or are competitors of some sort. Otherwise, why would they spend their valuable time making such a big deal out of nothing?
Or maybe I have it all wrong. If a person heads or works for an IMO, does that automatically make them a bad apple? I have investigated plenty of IMOs and, in fact, am currently working to bring down a couple of very large agencies in Texas and California. So, I guess, I have a pretty clear picture of what is/is not bad.
I have a question: If I complete an investigation of say, 70,000 bad cases, and afterwards assign these cases to agents I trust (so that they can re-write all the bad business) does that make me an IMO? If IMOs are all that bad, I certainly don’t want to be part of one.
Thanks, Mark

Posted: Wed May 20, 2009 09:46 pm Post Subject:

I don't think I even know who these two are. I don't think I've ever had any dealings with them.
One thing for sure though...If they took the time to talk with me they would find out that I'm a bit different from what they might have ran into in the past.
I personally think it must be some other IMO or competitor of some kind. Otherwise, they have nothing to go on other than ASSumptions.
Whoever it is I can surely say that I have never done them wrong and they have no basis for these personal comments about me.
I sure wish they had enough gumption to step out of the shadows and confront me directly. But, of course they won't do that.

Posted: Tue May 26, 2009 03:35 am Post Subject:

Although we receive the question about "how much insurance agents make" quite frequently, this recent discussion really brings up a second question...perhaps a follow up question. Insurance agents is such a broad category, and does not necessarily distinguish between the different careers in insurance.

For example, an insurance agent may make most of his income off of other agents (such as is the case with most IMO's). Even if not an IMO, an insurance agent could employ captive agents and make most of his money off of the efforts of others.

On the other hand, you have insurance agents that are independent that will never employ another agent. These insurance agents make most of their money (in fact all) off of their sales and bonuses / commissions. These agents may claim to be the hardest working, but it really depends how you look at it.

Many agents spend an incredible amount of time mentoring their new hire agents. I, for example, spend a lot more time riding with agents and field training them on their own appointments...then I do actually working on my own sales. As a result, a larger portion of my income is derived from the sales of others...but that doesn't mean I don't know insurance! I train agents that way because it helps them succeed and I would never ask them to split commissions with me...they have set up the appointment (or my team has set it for them) and I am just there to observe and counsel.

There are many different ways for an insurance agent to get paid...and none of them are right or wrong. There are negative practices in the insurance field, but labeling all IMO's as scam artists or multi-level marketers is inaccurate. However, as with any other industry, a few bad apples can spoil the bunch...and a couple negative publicities can lead to mass confusion and distrust!

Posted: Thu May 28, 2009 01:40 am Post Subject:

What some agents don't realize is that there are production levels that have to be made in order to get the IMO contracts. These are huge levels that no one agent could possibly do. So, needless to say, I have to meet certain criteria to sustain these contracts. It takes many agents to meet this. Now, because I am able to get these contracts, I can give good contracts. I give GA contracts out like candy. MGA contracts are at my disposal to give and I give those quite frequently too. I'm not in this to make a killing off one agent. I'm like Wal-mart, I deal in volume. That way, the agents reap the benefits...after all, they are the ones selling!!
Most of my contracts are given out at a simple 5% overwrite. That's just one level down from me in most cases.
I guess because of what I do and the way I do it (not screwing the agent), I take it a little to heart when someone bashes me without merit. Stating the exact opposite of what I do and who I am.
I still suspect that those two negative posts about me where from competitors. They (just like me) are all over these boards.
If it is competitors, the only reason they would do it because I have a tendency to let agents know what they should be getting. I'm ratting the greedy ones out you see.
I do have to agree that there are some shady ones out there, and how they remain in business is preying on the unsuspecting, usually green, agents. They come to me once they've seen the light! Then they get really surprised when I start raising some of their contracts by as much as 20% and more.
Thanks for letting me rant a bit. I tend to get excited when exposing greed!

Posted: Thu May 28, 2009 05:51 am Post Subject:

However, as with any other industry, a few bad apples can spoil the bunch

You are absolutely right Chris. But its unavoidable as well. Negative practices are also a part of the system. You only have to carefully choose the right option.

Posted: Mon Jun 01, 2009 03:43 pm Post Subject:

Many negative practices are the result of sheer laziness and greed. I read a story about an agent who was pushing expensive policies and products (didn't really have specifics) to people within his community. He admitted that it got to where he didn't even want to go to the grocery store because he was afraid he'd run into a disgruntled client.

Did he make good money? He says he did...but what kind of quality of life is there if you're afraid to go out in your community. Not to mention the difficulty sleeping at night!

There are many shortcuts that agents can take, and many people to take advantage of. I'm simply not willing to do that just to be "successful." My definition of success must be totally different than those agents. If you do the right thing for the right person, you never have to apologize for your actions!

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