October 26, 2021

The Average Insurance Agent Salary and 4 Ways to Increase It

by ILIAA

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If you are tired of working for someone else and want to branch out on your own, selling insurance may be the perfect career for you. It is competitive, with 409,950 agents in the U.S. as of May 2020.

You may be wondering what makes this such a popular career. The answer is simple—insurance agent salary amounts can be as high as the agent wants them to be. The key to this is training.

When you belong to an organization that provides you with the continuing educational support you need to market and sell insurance, the sky is the limit when it comes to income. If you are new to the insurance industry, the steps to becoming an agent are easy.

Maybe you have been selling insurance but things are not as lucrative as they once were. Let’s face it, 2020 was a year that took everyone down, and insurance agents also took a beating.

Knowing how to rebuild your client base will help build your income. Are you wondering about an independent insurance agency salary? Read on for answers to all your questions.

How Much Do Life Insurance Agents Make?

What you hear about life insurance agent’s salary will depend on who you talk to. Many working as life insurance agents lack training. The key to success is knowing how to promote and sell the product.

Agents with low income probably lack instruction on building their client base. They may be held back by working for a business that limits their product selection.

When you work for another agency, your appointments and the hours you put into the business may have limits. You are only able to sell the products allow you to sell and appointments they provide.

With proper training you are able to work on your own, selling products from a wide variety of insurance companies. You can build a policy program that fits your client’s needs, not those of an employer.

This allows you to gain a reputation for meeting the interests of your clients. Satisfied clients will spread the word about your excellent service.

Word of mouth is the best advertising when it comes to building your client base.

The average insurance sales agent salary in the U.S. is $56,226 as of October 19, 2021. The average salary does vary depending on agent experience.

Agents with less than a year’s experience average about $53,528 per year. Agents with more than 10 years of experience make about $69,328 per year.

Increase Your Salary

When working as an independent insurance agent salary is the main concern. People do not like to think about the fact that they will someday die and life insurance is a necessity.

The way to increase your salary is to help your client realize the importance of having insurance. You must also convince them they need to buy from you.

1. Knowledge Is Power

You need to convince potential clients that they need the products you sell. To do this, you need to know those policies inside and out.

Prospective buyers are impressed with agents who have complete knowledge of the product they are trying to sell.

For example, If you are selling a variable life insurance policy you need to know the policy designs, riders, features, benefits, and more.

When selling final expense insurance you need to explain the costs this policy will cover. This includes everything from the funeral home, burial expenses, cemetery, and paying the decedent’s debts.

You do not want to be hemming and hawing around when clients ask a question. If you don’t know the product you are selling, how can you convince them to buy it?

Knowledge doesn’t mean throwing a bunch of industry jargon they cannot understand at them.

Explain the policy and its benefits in layman’s terms they can relate to. To feel secure in making a purchase, the client must understand exactly what they are getting and their cost.

2. Perfect Your Presentation

To increase your chance of closing a sale, your client needs to feel comfortable with you. Do not launch into a formal presentation the second your feet cross the threshold.

Find a common ground on which they can connect with you. This can be something simple like noticing and asking about their artwork.

Maybe you have an appreciation for antique furniture they have in their home. A common hobby or sport, appreciation of a collection, or any other common interest creates a bond.

Your bond must be genuine. Don’t fake an interest that doesn’t exist, because they will see right through you.

Once you have found common ground, move into your presentation. To be professional, you should have your documents, charts, and speech organized to make it flow easily.

If you are new to the profession, the best way to develop this is to practice, practice, practice.

You do not want to dominate the conversation for the entire presentation. Ask the client open-ended questions to learn about their needs and concerns.

Address the client’s concerns as you move through your presentation.

Be open to them breaking in with questions at any time. Have those answers on the tip-of-your-tongue.

Make the client feel intelligent by complimenting them. Something simple like “that is an excellent question” before proceeding to answer builds a positive connection.

3. Have a Story

One way many successful agents close deals is to have relatable stories tucked into their brains. This helps them to humanize the life insurance sales process.

The stories do not need to be of tragedies, they can also be stories of success.

Share how a final expense policy helped a family provide a funeral for their mother. Without the insurance policy, the family would not have had the necessary funds.

Maybe a young family is better suited to the story of a mother who lost her husband in a tragic accident. His life insurance policy helped her keep the house and put the children through college.

The key is to share something your client can relate to. This helps them realize that life is unpredictable and life insurance is a necessity to purchase now.

4. Continuing Education

Even though you may have several years of experience under your belt, things are constantly changing. You need to stay current on popular trends and selling techniques.

By participating in continuing education opportunities, mentoring, and networking with other agents, you can continue to move up in your field. The more training your receive, the more your income will increase. 

An excellent way to build your skills is through membership in an association for insurance agents.

As an independent sales agent, you have the ability to determine the number of hours you work each week.

By combining education with work hours, you are able to set your own salary level. The freedom that comes with being your own boss provides a freedom that is unmatched.

How Do Insurance Agents Get Paid?

Don’t be surprised when a potential client hits you up with this question.

Clients paying insurance premiums often think they are paying you. Some think your salary causes an increase in their premium.

Let them know that you do receive a commission, which is a percentage of their premium. That payment comes from the insurance provider.

You as an agent are not paying the provider. The provider pays your commission when they receive a payment.

The amount of commission an agent receives varies from company to company, policy to policy, and state to state. On average, an agent or broker will receive more than 50% of the first year’s premium.

After the first year, the agent receives a renewal commission, which is up to 7.5% of the premium amount. This happens every year the policy remains in place for up to 10 years.

Having an insurance agent does not impact the cost of the policy. The cost of the policy will be the same whether they purchase from you or directly from the company.

The bonus to purchasing from you is they have a personal contact person. They can contact you if they have questions or problems.

As an independent life insurance agent, you will not be focusing on paying high advertising costs like the big insurance companies. Your main focus is on providing your clients with the best insurance package that meets their needs.

Show your client they are not just a policy number.

You value them as a person, a family, and as a client. You are providing them with customized service they will not get elsewhere.

Increase Your Insurance Agent Salary

It doesn’t matter whether you are just getting started or have been at this for years, you can increase your insurance agent salary.

Independent Life Insurance Agent Association offers mentorship, training, support, guidance, and coaching to help you take your career to the next level.

We encourage you to check out our website to learn more about our services and membership pricing. Through your membership, you will learn new sales techniques and ways to attract clients.

We also offer advanced case design and underwriting to help you grow your revenue. Advance your career by becoming a member today!


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