How to Become a Licensed Insurance Agent

how to become a licensed insurance agent

Although some high school grads have made a mark in the insurance business, the majority of licensed insurance agents are college graduates.

Each state has specific requirements for licensing. You’ll take an insurance license exam in your chosen area – such as auto, life or others. You can apply online to take the exams.

Although selling insurance is a relatively easy field to break into, it’s not easy to excel. You need tons of business savvy, with a mix of marketing know-how.

Why do Insurance Agents Need a License?

There are many types of insurance. Insurance agents need a license that covers each type of insurance.

Getting the proper license is required by the insurance industry – states require it. So, it stands to reason that licensing is also required by each individual insurance agency.

How Long Does It Take to Get an Insurance Agent License?

For each type of insurance license, someone must complete a mix of classroom training and independent learning. There is a minimum number of hours requirement.

How fast you work through the various types of insurance depends on you. You might be working a full-time job, and taking insurance courses at night. Or you might be taking courses towards getting insurance licenses full time.

If you don’t yet have a college degree, and you’re taking courses, focus on economics, finance, risk management and marketing.

Become a Licensed Insurance Agent in 7 Easy Steps

Your first decision is, what will be the work structure?

Captive Agent – This person will sell insurance for one company.

Independent Agent – This person sells insurance for a number of companies.

1. Choose What Type of Insurance Agent You Want to Become

Most agents gradually get all the licensing they can, but specialize.

For example, someone may choose to get a life insurance license and only be a life insurance agent, or focus on health insurance. Life and health insurance fall under the broad category of personal lines.

Here are some other types:

  • Property casualty (also personal lines)
  • Vehicle insurance (personal vehicles, motorcycles, rvs)
  • Commercial insurance
  • Disability insurance
  • Long-term care insurance

2. Pick the Insurance Products You Want to Sell

Property and Casualty policies protect against fire, theft, auto accidents and other damage.

Business policies may include property and casualty, and also liability.

Health insurance specialties may include focuses on long-term care provisions and disability.

States follow specific guidelines someone must adhere to in order to get licensed. States require that you take specific steps and pass the state exam in each field.

3. Pass the Pre-Licensing Requirements

Before you sign up to take an exam, most states require that you take a pre-licensing course. The pre-licensing training will provide a basic background in the field. A specific requirement is that you pass a background check.

Pre-licensing courses typically costs from $200 to $2,000.

4. Pass Your State Exam and Get Your License

After the pre-licensing course, you can study your specific area of focus. Then you’ll sign up to take your state’s insurance license exam in that specific field, so you can fulfill the licensing requirements.

Once you pass the state examination, you can make license application through the state. Insurance licensing exams cost from $40 to $150, depending on the type of insurance.

You have to pass the state exam before you can sell insurance.

5. Submit Job Applications

Once your studies and exams are complete, you’re ready to apply to an agency. Make sure your application is complete, especially the result of each examination you’ve passed.

Check over your application and correct any mistakes. Paperwork is of utmost importance in the field. Mistakes on your application may disqualify you for a second interview. You can also look into LinkedIn for insurance agents for marketing and employment opportunities.

6. Get Appointed with an Insurance Company

Once you start work, expect to work at least 40 hours a week. Many of those hours may be in the evenings and on weekends, to accommodate your customers’ work schedules.

In addition to having the proper licenses, you’ll be asked to complete your application by submitting to a background check.

Once all that’s complete, you can start making sales for insurance franchise companies or top small business insurance providers.

7. Complete Continuing Education Requirements

Continuing education requirements vary by state. The most common that many states require is 24 hours of continuing education – a course, seminar – every two years.

The National Association of Professional Insurance Agents often offers webinars, and provides information about education options.

How much does it cost to become an Agent?

The pre-licensing courses may cost from $200 to $2000. Courses and study materials for each type of insurance may cost from $60 to $300. And the fee for each state examination may cost from $40 to $150.

After you pass a specific examination, the fee for your application to the state for licensure may cost from $30 to $200. Background check fees may cost from $30 to $100.

Are you running a calculator for this? Don’t forget to add in the cost to obtain a college education.

Remember that these costs vary by state.

How much does an insurance agent make?

The average agent makes about $80,000 annually. The salary range goes from $18,000 to $186,000.

The pay is dependent on the type of industry you serve, and also your location in the country.

Your pay may be a salary, plus commission. Sometimes your length of time and sales record with agencies determines how you will be paid.

What qualifications are needed to become an insurance agent?

Well, you better genuinely like people, and providing assistance to people. Agents often get recommended because of the services they provide to other customers. Aspects of services that customers most appreciate include timely responses and ease of access. You’ve got to be available when services are needed.

Here are some other skills you should have as an insurer:

  • Good with math
  • Good at listening to people
  • Able to quickly respond to questions and claims, willing to contact a customer at any time.
  • Able to do basic photography
  • Some who is on time for every appointment

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Lisa Price Lisa Price is a staff writer for Small Business Trends and has been a member of the team for 4 years. She has a B.A. in English with a minor in journalism from Shippensburg State College (Pennsylvania). She is also a freelance writer and previously worked as a newspaper circulation district manager and radio station commercial writer. In 2019, Lisa received the (Pennsylvania) Keystone Award.