Insurance sales agents help insurance companies generate new business by contacting potential customers and selling one or more types of insurance. An agent explains various insurance policies and helps clients choose plans that suit them. Although most insurance sales agents work for insurance brokerages selling the policies of several companies, some work directly for a single insurance company.
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Insurance sales agents typically do the following:
• Call potential clients to expand their customer base • Interview prospective clients to get data about their financial resources and discuss existing coverage • Explain the features of various policies • Analyze clients’ current insurance policies and suggest additions or changes • Customize insurance programs to suit individual clients • Do administrative tasks, such as keeping records and handling policy renewals • Help policyholders settle claims.
Insurance sales agents commonly sell one or more types of insurance, such as property and casualty, life, and health and long-term care. Property and casualty insurance agents sell policies that protect people and businesses from financial loss resulting from automobile accidents, fire, theft, and other events that can damage property. For businesses, property and casualty insurance also covers injured workers' compensation, product liability claims, or medical malpractice claims. Life insurance agents specialize in selling policies that pay beneficiaries when a policyholder dies. They also sell annuities that promise a retirement income. Health and long-term care insurance agents sell policies that cover the costs of medical care and assisted living services in old age. They may also sell dental insurance and short-term and long-term disability insurance.
An increasing number of insurance sales agents offer their clients comprehensive financial planning services, especially for clients approaching retirement. These services include retirement planning, estate planning, and help in setting up pension plans for businesses. In addition to offering insurance, these agents may become licensed to sell mutual funds, variable annuities, and other securities. This practice is most common with life insurance agents who already sell annuities, but many property and casualty agents also sell financial products.
Many agents spend a lot of time marketing their services and creating their own base of clients. They do this in a variety of ways, including by making “cold” sales calls to people who are not current clients. They also find new clients through referrals by current clients. Keeping clients happy so they recommend the agent to others is a key to success for insurance sales agents.
Most employers require agents to have a high school diploma; however, more than one-third of insurance sales agents have a bachelor's degree. Agents must be licensed in the jurisdictions where they work.
Public speaking classes can be useful in improving sales techniques, and often agents will have taken courses in business, finance, or economics. Business knowledge is also helpful for sales agents hoping to advance to a managerial position.
Insurance sales agents learn many of their job duties on the job from other agents. Many employers have new agents shadow an experienced agent. This allows the new agent to learn how to conduct the company’s business and how the agency interacts with clients.
Employers also are increasingly placing greater emphasis on continuing professional education as the variety of financial products sold by insurance sales agents increases. Changes in tax laws, government benefits programs, and other local and federal regulations can affect the insurance needs of clients and the way in which agents conduct business. Agents can enhance their selling skills and broaden their knowledge of insurance and other financial services by taking courses at colleges and universities or by attending conferences and seminars sponsored by insurance organizations.
Insurance sales agents must have a license in each of the jurisdictions where they work. Separate licenses are required for agents to sell life and health insurance and property and casualty insurance. In most cases, licenses are issued only to applicants who complete specified courses and who pass state exams covering insurance fundamentals and insurance laws. Most licensing authorities also require agents to take continuing education courses every two years, focusing on insurance laws, consumer protection, ethics, and the technical details of various insurance policies.
As the demand for financial products and financial planning services increases, many agents also choose to get licensed and certified to sell securities and other financial products.
A number of organizations offer certifications that show an agent’s expertise in insurance specialties. These certifications are not required for employment, but they can give job candidates an advantage over other applicants. Certifications can also be a source of continuing education credit.
Most insurance sales agents work in offices, although some may spend much of their time traveling to meet with clients. Their work environment may vary depending on the type of company that employs them. Since some agencies are small, agents may work alone or with only a few others.
Insurance sales agents usually determine their own hours of work and often schedule evening and weekend appointments for the convenience of clients. Some meet with clients during business hours and then spend evenings doing paperwork and preparing presentations to prospective clients. Most agents work full time and some work more than 40 hours per week.
The median annual wage of insurance sales agents was $46,770 in May 2010. (The median wage is the wage at which half the workers in an occupation earned more than that amount and half earned less.) The lowest 10% earned less than $25,940, and the top 10% earned more than $115,340.
Sales workers who are employees of an agency or an insurance carrier may be paid in one of three ways: salary only, salary plus commission, or salary plus bonus. In general, commissions are the most common form of compensation, especially for experienced agents. The amount of the commission depends on the type and amount of insurance sold and on whether the transaction is a new policy or a renewal. When agents meet their sales goals or when an agency meets its profit goals, agents usually get bonuses. Some agents involved with financial planning receive a fee for their services rather than a commission.