Great question! The best answer I can give you is : that depends upon the agent. Most insurance agents are paid on commission, meaning they get paid based upon what they sell. The individual company may or may not provide some form of salary, or provide benefits, but the bulk of the agent's income will come from his or her efforts at getting the product sold. If the agent is not motivated to work hard , the income is lower than one who is more motivated. I think that is why some people look at insurance agents like they are "used car salesmen" ( no disrespect to used car salesmen intended) as some of them use the same high pressure tactics to make their sale. There are a great number of agents out there that do not act that way, and I am sure that you will find one. If I can help further, please contact me, I'll be happy to help. Thanks for asking!
Yup... Most of us are compensated based on a percentage of the premium you pay. The actual percentage is all over the map. It depends on the insurance company used, the contract between the agent & the company, volume, and more. It can be between 5% and I've seen as much as 25% of the first year premium. Yet the average is 10-15%. Some companies pay a level amount year to year while others have a slightly higher first year compensation (like 15/10%).
DO NOT say, "Oh ... My ... Gosh. 15%! If there were no agents the rates would be so much lower!" Agents are responsible for SO MUCH related to your account. If there were no agents, the companies would have to buy/rent a vastly more office space, pay for health benefits, income taxes, and more. It is MORE expensive to have "employees" vs. agents that must use the low compensation to hire their own employees, pay rent, etc.
Commission is the best compensation model there is. You've seen it... Someone at your job, in the same role, making the same $$ as you, who doesn't nearly work as hard as you do!! In my area there is a wave of commercials proclaiming, "Our sales people are not on commission". WHY NOT??? When someone is compensated in direct proportion to the # of people they serve instead of an hourly wage or salary, that person is driven to PERFORM. Want to earn "what you're worth?" Then help more people. Commission compensation breeds efficiency, high quality service, and professionalism. PROS will consummate more transaction, not high pressure sales people. Sure, a few sleazebags are out there selling snake oil using tactics to get as many sales on the books as possible. They don't last long, especially in today’s "Social media world". Reputation is a much better governor than regulation.
.JPG){kind=avatar}
DO NOT say, "Oh ... My ... Gosh. 15%! If there were no agents the rates would be so much lower!" Agents are responsible for SO MUCH related to your account. If there were no agents, the companies would have to buy/rent a vastly more office space, pay for health benefits, income taxes, and more. It is MORE expensive to have "employees" vs. agents that must use the low compensation to hire their own employees, pay rent, etc.
Commission is the best compensation model there is. You've seen it... Someone at your job, in the same role, making the same $$ as you, who doesn't nearly work as hard as you do!! In my area there is a wave of commercials proclaiming, "Our sales people are not on commission". WHY NOT??? When someone is compensated in direct proportion to the # of people they serve instead of an hourly wage or salary, that person is driven to PERFORM. Want to earn "what you're worth?" Then help more people. Commission compensation breeds efficiency, high quality service, and professionalism. PROS will consummate more transaction, not high pressure sales people. Sure, a few sleazebags are out there selling snake oil using tactics to get as many sales on the books as possible. They don't last long, especially in today’s "Social media world". Reputation is a much better governor than regulation.
Have any questions? Reach out -gravy