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: Mon Feb 01, 2010 01:25 am Post Subject:
The truthful answer to this question is not nearly as much as many would have you believe.
Posted: Tue Feb 09, 2010 02:02 pm Post Subject: no experience
what if you have no experience? For example, I have a friend and she is about 20 years of age and she told me she is making 1500 dollars a week, she has no experience and no education but a GED. I have a double masters and I'm not making that kind of money. Is she being honest? Please reply with an answer on rickeym_dogg@hotmail.com :oops:
Posted: Tue Feb 09, 2010 06:49 pm Post Subject:
Hello Rick, I'm sure that most of the "old-timers" on here will agree with me on this:
With our minds out of the proverbial gutter, it depends on who she's working for. For example, if she's working for Primerica, she isn't making that much money and literally hasn't a hope in hell of ever making that much money, but she's been thoroughly brainwashed and therefore believes she will - some day.
There are a number of other "cultish" companies out there who subject their agents to a type of "mental overload" sometimes as often as two or three times a week. Someone with a double Masters, like you, usually has a much firmer grip on reality than others who are, we'll say, "less sophisticated."
On the other hand, Bill Gates was a college dropout......so who really knows?
Posted: Fri Feb 19, 2010 04:14 pm Post Subject:
As with all commission based jobs, I think insurance agents pay depends on how hard the agent works. The harder an agent works, the better he is paid.
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Posted: Tue Mar 02, 2010 08:54 pm Post Subject:
Lots of hard work and the money will come in time.
Posted: Fri Mar 05, 2010 08:05 pm Post Subject:
I already own a business and wish to become a property and casualty agent..I love being independent but really enjoy have a steady income. Which would be more profitable Independent or become a broker for another company? Also, after the education and licensing procedure what would be my next step?
Posted: Sat Apr 03, 2010 08:13 pm Post Subject: Pennsylvania Life Insurance
Is Pennsylvania Life Insurance a captive or independant agency? Do you know what there usual commission structure is?
Posted: Tue Apr 20, 2010 02:46 pm Post Subject:
what type of school do you need to be an insurance agent?
Posted: Tue Apr 20, 2010 02:50 pm Post Subject:
You need to attend a school that has been appointed by your state insurance department to train you as an agent. Once you complete the required in-school hours, then you take a state exam.
Posted: Wed Apr 28, 2010 08:09 pm Post Subject:
I hear Pennsylvania Life is captive.
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