The process to become a licensed insurance agent is actually quite simple.
To start, you’ll need to apply for a license with the state in which you want to work.
Essentially, this is just a matter of filling out some paperwork and paying a fee.
Once you’ve gotten your license, you can start selling insurance products from any number of companies.
How To Become Licensed Insurance Agent
5 Steps to Becoming an Insurance Agent
Step 1
Decide if you want to complete an associate or bachelor’s degree program.
A college education can help experienced agents move into careers in risk management, working as actuaries, or other positions that require postsecondary education. Plus, having a background in business and finance can be a tremendous asset to agents.
Step 2
Pick a specialty.
Agents sell many different kinds of insurance, such as property, casualty, disability and personal lines of insurance. These are referred to as “lines of authority” in the industry. Agents must receive licensure for their particular line of authority. Knowing what type of insurance you want to sell is an important step in the career path.
Step 3
Complete pre-licensure requirements.
Pre-licensure requirements vary from state to state, but they are a mandatory step toward earning licensure as an insurance agent or broker. For example, California applicants for casualty licensure must complete 20 hours of general pre-licensing education, as well as 12 hours of education in the state’s ethics and insurance codes. Students should check with their state’s insurance department for pre-licensure requirements.
Step 4
Pass a licensing exam.
All agents must pass a licensing exam to sell insurance. The National Insurance Producer Registry has compiled a list of state-specific licensing requirements, associated fees and other important data about the licensing process.
Step 5
Apply at insurance agencies.
Agents who have met all the requirements and earned licensure are eligible for employment at insurance agencies and brokerages, which can vary from small local brokerages to regional offices of well-known insurance carriers.
Insurance Agent Salary & Job Growth
Wages for insurance agents are typically tied to commissions, which can account for a wide discrepancy in pay. Wages also vary greatly depending on an agent’s skills, specialties and experience.
According to the Bureau of Labor Statistics, median annual salaries for insurances sales agents was just under $50,000 in 2017. However, the top 10 percent of agents earned more than $125,000 annually, while the bottom 10 percent took home just over $27,000.
Payscale.com places median wages for entry-level agents at just over $33,000 annually, while more experienced agents earn approximately $42,000 per year. Late-career professionals and agents with skills in customer relations, account sales and management all can potentially earn more.
The following chart shows mean annual wages and employment data by state for insurance agents:
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Alabama
Mean wage annual: $78,860
Alaska
Mean wage annual: $60,910
Arizona
Mean wage annual: $64,430
Arkansas
Mean wage annual: $59,890
California
Mean wage annual: $77,700
Colorado
Mean wage annual: $65,030
Connecticut
Mean wage annual: $77,300
Delaware
Mean wage annual: $66,450
Florida
Mean wage annual: $67,140
Georgia
Mean wage annual: $62,290View More
Employment of insurance agents is expected to increase by 10 percent through 2026, the BLS reports. That translates into about 50,000 new positions during that time span. Demand is expected to be greatest for independent agents as large insurance organizations place more emphasis on these agents to help control their costs.
Although insurance agents play a key role in the industry, many consumers in today’s highly connected world perform online research and purchase policies on their own, which has reduced demand for new agents. Still, online shoppers typically have regular interaction with agents to help fully understand their policies, make changes, file claims, and other routine business.
Job prospects are expected to be best for college-educated agents and agents with excellent sales, customer service and communications skills, as well as for multilingual agents who can serve a wider customer base.
Finding an Insurance Agent Program
As noted, insurance agents aren’t required to complete formal degree programs to work in the field. They are, however, required to complete pre-licensure training to develop core competencies in regards to the insurance products they will sell to their clients. Agents can complete these requirements through a number of online service providers, or they can attend regional training facilities certified through their state’s insurance department. Key points to consider when researching pre-licensure programs include delivery method, length and cost.
Remember that each insurance product – property, casualty, life, etc. – requires certification. There is no blanket certification that allows agents to sell every insurance product. Agents should know what type of product they’ll work with, as well as the state in which they’ll work prior to beginning pre-licensure training to ensure they meet the licensure requirements in their home state.
Agents who choose to enroll in associate or bachelor’s degree programs to potentially boost their career opportunities can use the search tool below to help find appropriate degree programs in their home state.
Top 10 Insurance Agent Associations & Groups
Membership in insurance agent associations and industry trade groups can help insurance agents in numerous ways. These organizations offer opportunities for professional development, help agents stay abreast of important industry news and events, and provide an important voice of advocacy in legislative and regulatory issues. They also can lead to key networking opportunities, which is an important business development tool for insurance agents and brokers – relationship building has long been a key tenet of the insurance industry.
Insurance agents should consider membership or attending the national conferences of one or more of the following organizations:
- American Insurance AssociationThe leading trade organization for agents who work in property and casualty insurance. Provides agents with access to industry expertise in insurance law, tax, claims and accounting, public policy representation and access to a wide range of online resources.
- American Council of Life InsurersTrade group representing more than 290 member companies. ACLI members write 93 percent of life insurance policies written in the U.S. Provides advocacy, guidelines on industry standards, a wealth of fact-based research, and networking opportunities at events held throughout the year.
- Council of Insurance Agents & BrokersThis Washington, D.C.-based trade association was founded in 1913 and represents leading commercial and employee benefits brokerages. Provides leadership academies, conferences, working groups and professional development opportunities.
- Independent Insurance Agents & Brokers of AmericaNational alliance of more than 250,000 business owners and employees working in all sectors of the insurance industry. Provides legal advocacy, online resources, professional development, education, and networking opportunities at events and conferences.
- Insurance Information InstituteProvides information, resources, analysis and referrals for a diverse range of members, including insurance professionals, media, regulatory organizations, higher education institutions and their students.
- Women in Insurance and Financial ServicesThe leading trade organization is dedicated to women working in the insurance and financial services industries. Member benefits include access to monthly webinars on business mentorship and professional development, peer connection opportunities, and registration to the WIFS annual national conference.
- Risk and Insurance Management SocietyFounded in 1950 to represent agents working in risk management. Offers opportunities for professional certification, IRMI conferences, continuing education and tens of thousands of pages of online reference content.
- National Association of Professional Insurance AgentsThis trade association was founded in 1931 and has agent members in all 50 states. Provides opportunities for personal education, a wide range of industry-specific insurance products, marketing materials, and discounts with many different goods and service providers.
- American Agents AllianceFounded in 1962 in Southern California, this member-driven organization is dedicated to serving the needs of independent brokers and agents. Membership benefits include access to industry insurance, government advocacy, continuing education, and networking opportunities at local meetings and the AAA national convention.
