June 2, 2021

Everything You Need to Know for Becoming a Life Insurance Agent

by ILIAA

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Are you thinking of starting a career as a life insurance agent?

Selling life insurance can be a lucrative career choice. Estimates state that the average insurance agent salary is $106,428 per year. Broken into hourly rates, this equates to an average of $51 per hour.

What’s more, if you can crack the code of being a highly successful life insurance sales agent, you can earn up to $142,000 per year and build a sizable source of passive income.

However, insurance sales is a competitive arena. The BLS estimates that there were 409,950 life insurance agents in the United States in 2020.

That said, it is possible to create a successful insurance agent career for yourself.

The key is understanding what it takes and how to start.

Are you ready to find out what’s involved in embarking on a lucrative insurance agent career? Then, carry on reading to find out everything you need to know. 

The Traits You Need for Becoming a Successful Life Insurance Agent

Before we get into the steps involved in becoming a life insurance agent, let’s first look at some of the traits you need to become successful.

Having the right personality, approach, skills, and attitude are essential for any sales job. However, it’s even more critical if you’re thinking of starting a life insurance career.

Life Insurance Can Be a Tough Sell

Even though it’s an important product, life insurance can be a tough sell. Consumers are faced with a plethora of ways to spend their money, and the long-term benefits of life insurance can pale against the short-term attraction of tempting purchases.

For instance, compare selling life insurance to selling cars. Owning a new car has a host of emotional ramifications. Being able to buy and drive a new car not only feels great, but it’s also a status symbol.

Life insurance, on the other hand, is totally different. Although it doesn’t bring immediate pleasure, it can win your client’s peace of mind and security. 

Getting Into Your Clients’ Shoes

Life insurance isn’t something that’s going to impress, and taking out a policy doesn’t have the same satisfaction as pulling up somewhere in a smart new vehicle or going on a luxury holiday.

If you want to be successful, you need to know how to sell life insurance to your clients in a way that makes them feel like it’s a must-have. To do so, you have to be adept at tailoring your pitches to each client and their unique pain points.

You need to step into their shoes and figure out what selling points will make your product attractive enough for them to feel they can’t do without it. For this, you will need to be empathetic, a good listener, and a good judge of character. 

Not Giving Up

Any type of sales work is filled with no’s. This is especially true for a life insurance agent. One of the most important insurance agent skills to have is persistence and the tenacity not to give up to carve a successful career.

There will always be nos and clients that don’t buy, even when you are a successful and prosperous life insurance agent. Mentally prepare yourself for this, and remember that it is a numbers game. The more nos you get, the closer you might be to the next sale.

Cultivating an Always-on Mindset

Because competition is fierce in insurance sales, you need to cultivate an always-on mind. As a life insurance agent, you may often have to meet with clients after hours or on weekends.

You will also need to always be actively thinking about life insurance and looking out for potential new leads.

All of this requires a lot of energy. However, if you are a high-energy personality, this can help you sustain the drive needed for continued sales.

What Training You Need

To start selling and gain life insurance experience, the first thing you’ll need to do is get licensed.

You don’t need to go to college to become qualified as a life insurance agent. Instead, you’ll need to complete a required amount of coursework, after which you can apply for your license exam.

Different states have different requirements for life insurance licenses. Therefore, make sure to check what your specific state’s requirements are before you pick a course.

While this is all the training you must have to become licensed; it’s not all you need to build a life insurance agent career. The required courses for becoming a life insurance agent teach you the basics of how life insurance works and your role as the agent.

However, they don’t hone your insurance agent skills, teach you how to deal with clients, generate leads, promote yourself, gain referrals, etc.

These areas are all crucial to having a successful life insurance experience. Therefore, it’s also a smart move to invest in further training.

Here at ILIAA, we are committed to giving every life insurance agent who signs up with us access to the best, most streamlined, and impactful training in the industry.

Besides sharing advanced sales and prospecting techniques that attract your ideal clients, we also teach advanced case design and underwriting, and offer full support and mentorship.

If you have a once-off area or issue you want help with, you can also schedule a coaching call with us!

Deciding Whether or Not to Be an Independent Agent

Once you are licensed and have the training you need, you will also need to decide whether or not you want to be an independent agent.

If you want to look for a job with an insurance carrier or broker, you will need to start job hunting and putting a resume together. Take note, however, that most insurance agents don’t earn a salary and instead work solely on commissions. In rare cases, a broker or carrier might offer you a small retainer.

In many people’s life insurance experience, they find they can earn more working as an independent agent. Along with higher earnings, you’ll also be able to enjoy more freedom if you work as an independent life insurance agent.

The flexibility and freedom of an insurance agent career attract most people to it in the first place. As an independent agent, you can work the hours you choose, devote as much or as little time as you want, and fit your life insurance agent work around pre-existing responsibilities.

Understanding Contracts and Releases

If you are taking the route of an independent agent, the next step is to get contracts with an upline to sell products. When doing this, it’s essential that you also understand how releases work. 

How Contracts With Carriers Work

Most insurance carriers do not work directly with independent agents. Instead, they outsource the job of working with agents to IMOs (Insurance Marketing Organizations).

IMOs then have several General Agents (GAs) that act as recruiters. These GAs then work with you and other independent agents, issuing out contracts to sell specific products.

When you make a sale, your IMO and GA will typically both receive a percentage commission. For instance, if you make a sale with a 100% first-year commission, your GA might earn 120% (minus your portion), and the IMO may get 140% (minus the GA’s and your commission).

Because of this, some IMOs and GAs are reluctant to release their agents from being contracted. After all, with every sale you make, they earn a percentage, and they have invested the time to recruit and contract you. 

However, you must make sure you will be released from a contract if you so wish. 

The Importance of Release Policies

If you wish to discontinue a contract with an IMO, they will need to release you from it in writing through a form or letter. 

If they refuse to do this, the only way to get out of the contract is to cease writing business with the carrier for six months. At this point, the carrier will automatically cancel your contract when requesting a new contract with a new upline.

If you have a few main carriers and wish to cancel your contracts with your current IMO and switch to a different up-line, this means you’ll have a six-month dry period where you can’t make sales. Alternatively, it will force you into a different market for that time.

Therefore, when signing with IMOs, make sure they show you their release policy. If they do not have one, you will do well to move onto a different IMO.

Launch Your Life Insurance Agent Career With the Right Support

Although life insurance is a competitive market, if you can break into it, you can build up a beautiful stream of revenue for yourself and generate passive income for years to come. What’s more, reports are showing that increasing numbers of consumers are planning to buy insurance.

If you have been contemplating a life insurance agent career, the time to start is now, and we can help.

With ILIAA, you gain access to industry-leading education and training. We show you how to ramp up leads, close more sales, and sell products like a seasoned pro. We also provide ongoing support and mentorship.

Insurance can feel like a complicated field if you’re entering it. Are you ready to take away the uncertainty and supercharge your life insurance career? If so, check out our membership pricing today.


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