As one of the Best Jobs of 2012, this profession should see significant growth over the next decade.
By Philip Moeller
February 27, 2012
Insurance agents must be licensed by the states in which they sell insurance products. They usually concentrate on a specific type of insurance, such as auto, home, life, or health insurance. There also is a large market for selling commercial insurance to businesses and other organizations. Commercial lines deal with often-complex property damage and liability policies, employee and executive coverage, and product liability as well. Roughly a quarter of insurance agents work for an insurance company and often sell its products exclusively. About half work for an independent insurance agency or brokerage and sell the products of many insurance companies. Nearly 20 percent are self-employed. Commissions are an important source of income for most insurance agents, although a smaller number hold salaried positions. As a salesman, agents spend considerable time developing and pursuing sales leads. Consumer-policy agents do a lot of telephone and office work. Commercial agents are more likely to be out in the field with customers. Independent agents who work for a brokerage may have irregular hours, but they also have more control over their work schedules than agents who work for an insurance company or spend most of their time in an office.
The Bureau of Labor Statistics projects insurance agent employment growth of 21.9 percent between 2010 and 2020. That’s an addition of 90,200 new jobs and 94,200 replacement jobs. There were 411,500 insurance agent jobs in 2010. Demand for these positions is directly linked with population and economic growth. As the commercial and consumer markets continue recovering from the recession, expanded opportunities for insurance agents will appear. “Almost every agency I know is looking to hire agents,” says Robert Rusbuldt, head of the Independent Insurance Agents & Brokers of American. The IIABA, widely known in the industry as the “Big I,” is the profession’s largest trade group with more than 300,000 agent members.
According to the Labor Department, the median annual salary for insurance agents was $46,770 in 2010. The best-paid 10 percent made an average of $115,340, while the lowest-paid 10 percent were paid $25,940, on average. The highest salaries were paid by insurance and employee benefit funds, outpatient care centers, and credit card companies and other non-depository credit firms. The highest-paid insurance agents worked in the metropolitan areas of Glenn Falls, N.Y., Oakland, Calif., and Sheboygan, Wis. “If you’re good at what you do,” Rusbuldt says, “you’re going to make a lot of money.”
Insurance Agent Salary
Education and Preparation:
High school diplomas are sufficient for most insurance agent positions. College degrees may be required for specialized sales positions, and especially for agents who also are licensed to sell investment products and provide investment advice to clients.
Substantial knowledge of individual lines of insurance is needed and insurance agents have continuing education requirements to retain their state licenses and make sure they maintain current knowledge of their field.
On Landing an Insurance Agent Job:
Insurance requires more expertise than many other sales jobs, says Rusbuldt. But at the end of the day, employers are looking for strong sales skills,an aggressive, positive attitude, and very strong interpersonal and verbal communications skills. “Being an extrovert helps—you are in sales, after all,” he says. “Being able to forge relationships with people, particularly in the commercial lines of business,” is very important. “Employers want to know that you’re a person of integrity and someone they can rely on.” While knowledge of insurance and prior training in the field are always a plus, Rusbuldt says, hiring managers want people who are willing to learn and hungry for a career in the field. “You can teach insurance,” he says. “You can’t teach the willingness to learn.”
What is an Insurance Agent Job Like?
Rusbuldt says the client-development work of an agent makes the field ideal for self-starters who want the independence of setting their own hours and, especially for commercial-lines agents, spending time in the field. Agencies encourage their
agents to spend time volunteering in their communities, working with charities and being active in business and civic groups. “They have a lot of flexibility in their schedule,” he says. Rusbuldt says there can be a big difference in the jobs of property-casualty agents and agents who sell mostly life insurance. Property-casualty agents earn recurring commissions and thus
can develop a solid book of business over time that will generate residual commission income and the need to keep close customer ties to encourage policy renewals. Life insurance agents, he says, earn most of their money through sales of policies to new customers and not through renewals. For them, finding new clients is key, and they tend to be more focused on meeting new people. Opportunities for women and minorities have been growing rapidly, Rusbuldt says, particularly among Hispanics. “The lifestyle of an independent insurance agent is perfectly suited to someone who has the ability to do different things, who wants control over their schedule, and who wants to be involved in their community.”