The Top 10 Things to Consider Before Becoming an Insurance Agent - Western Asset Protection
becoming an insurance agent

The Top 10 Things to Consider Before Becoming an Insurance Agent

Insurance is a solid career choice. Few other industries provide such good earning potential and the chance to be your own boss without the need for a college degree. There’s also a high demand for insurance sales professionals. According to the BLS, the number of positions for insurance agents is expected to grow by 8% over the next decade, which is significantly faster than the average growth rate of 3% for all industries. However, not everyone is suited for insurance sales. If you’re interested in becoming an insurance agent, ask yourself the following 10 questions.

1. What type of insurance should I sell?

You need to decide what type of insurance you want to sell to obtain the correct license. For example, a property and casualty insurance license is necessary for selling homeowners and car insurance. You may also want to specialize in a particular type of insurance. Although there are many options, Medicare stands out as a top choice. According to the U.S. Census Bureau, 10,000 people turn 65 every day. These seniors are aging into Medicare and need help selecting a plan.

2. What education do I need to become an insurance agent?

You typically don’t need a college degree to become an insurance agent, although many agents do have degrees. In general, all you need is a high school diploma and the training your state requires of licensed insurance agents. Some states have additional requirements for certain types of products. For example, Arizona has specific requirements for agents who want to sell annuities or long-term care insurance. You may also need to meet training requirements established by other governing bodies. For example, CMS has training requirements for Medicare sales agents.

3. How can I obtain a license to sell insurance?

To sell insurance, you need to obtain a license that covers the lines you’ll be selling in the state or states where you will be operating. To qualify for the license, you will typically need to take an approved course and pass a test. There may be some other eligibility requirements. For example, in Arizona, you must be at least 18 years old.

4. Will I need any continuing education as an insurance agent?

In most states, after you’ve obtained your insurance license, you need to meet continuing education requirements. CMS also has annual training requirements for Medicare sales agents. Lastly, you may need to complete training for the carriers whose products you will be selling.

5. What skills do I need to be a successful insurance agent?

To succeed as an insurance agent, you need certain skills, namely:

  • People Skills: Since you’ll be working directly with clients, you need to be a skilled listener and conversationalist. You’ll also need to perform needs assessments, present solutions, answer questions, and follow up as needed.
  • Organizational Skills: Since you’ll be handling many important documents, meeting with many people and dealing with many deadlines, you need to stay organized.
  • Computer Skills: Most agents manage their tasks and daily workflow within a CRM system. They also use online quoting systems and other tools with their carriers’ agent portals.
  • Entrepreneurial Skills: Most insurance agents earn commissions. The amount you earn will depend on how much you sell, so you need to be a motivated self-starter.
  • Sales and Marketing Abilities: To promote your business, you will need to perform sales and marketing tasks. This will include maintaining a website, participating in events, forming alliances with provider groups and other referral sources, and regularly communicating with prospects via a variety of channels.

6. Should I become a captive or independent insurance agent?

A captive insurance agent only represents one insurance carrier. That severely limits the number of choices you can offer your clients and means you’re at the mercy of that one carrier’s decisions. As an independent insurance agent, you can contract with multiple insurance carriers to offer your clients a wide range of options. The more carriers you contract with, the more options you can provide.

7. How much money can I earn as an insurance agent?

The BLS says the median annual pay for insurance agents in 2022 was $57,860, which is above the national average for all occupations of $46,310. However, some insurance agents earn much more than this. Glassdoor says independent insurance agents earn $115,000 to $215,000 a year.

8. How can I find insurance marketing support?

Independent insurance agents can work with field marketing organizations (FMOs), like Western Asset Protection, for marketing support. FMOs can also provide other types of support, including guidance on compliance issues, assistance with licensing and certification and extensive product and sales training. You don’t have to do everything on your own!

9. What regulations do I need to adhere to as an insurance agent?

Insurance agents need to be aware of the regulations that pertain to the lines they sell. For example, Medicare insurance sales are regulated by CMS. States also establish rules for various lines of insurance.

In addition to following relevant insurance regulations, you need to comply with rules for marketing, such as the CAN-SPAM Act, which regulates email marketing.

10. How can I get started?

If you’ve read this far and are still interested in becoming an insurance agent, it’s time to think about the next steps. First, you should look up the insurance licensing requirements in your state. You may also want to partner with an FMO that can help you with training and marketing. If your interested in becoming a Medicare insurance agent, see how WAP can help.