Did you know you can sell all or a portion of a life insurance policy, even term insurance?
(2 minute read)
Life insurance agents can make good money, because their salary is often largely based on commission, even when an employer pays them a base salary. If you are an independent insurance agent, commission rates become even more important because you will only be paid based on commission. This is one reason most insurance agents sell a wide range of insurance products, not just focus on one type of policy. Let’s explore the average yearly earnings of a life insurance agent and different types of approaches that can allow these professionals to make more money.
Average Life Insurance Agent Salary
The average insurance agent salary in 2020 was $52,180 a year, according to the US Bureau of Labor Statistics. This includes life insurance agents. Overall, the job outlook for insurance agents appears steady and secure. The insurance sales industry is expected to grow 5% by 2029, which is slightly faster than the national average. Though many customers use the Internet to research policy options and providers, they still rely on agents to fully explore and understand the policy that is right for them. This is especially true with life insurance, where different types of life insurance policies offer different benefits for each person and family.
The top 10% of insurance agents earn more than $127,000 a year, reflecting just how much opportunity for earnings can be achieved through commissions.
How Can Life Insurance Agents Increase Earnings?
Increasing life insurance earnings happens in one of two ways: the agent works harder to make more sales, or they work smarter to achieve more value while also serving their client’ best interests. Simply chasing an increase in sales might inspire someone to sell policies that aren’t needed. Here are a few strategies life insurance agents can use to ethically increase earnings.
- Cycle Back Through Leads: One way to increase earnings as a life insurance agent is to follow back up with old leads that didn’t purchase a policy at that time. Their life situation or needs may have changed, making this a better time to buy life insurance.
- Expand Marketing Channels: Life insurance agents can increase the number of available qualified leads using tactics like digital marketing. If the pay-per-click bids are too expensive to do search engine marketing, you can try strategies like hosting a webinar or creating an eBook. You can also try in-person marketing like sponsoring an event, print advertising, or direct mail.
- Keep Life Settlements in Mind: Every life insurance agent will eventually end up talking with a client who no longer wants, needs, or can afford a policy. In some of these scenarios, a life settlement may be a better option for your client. For policyholders over a certain age, these regulated transactions allow them to gain much more value out of selling the policy than they would if it were surrendered. If they are party to the transaction, the life insurance agent gets part of the commission fees.
Life insurance commissions are based on the size and type of policy being sold, meaning a life insurance agent commission calculator differs from one source to the next. The amount an agent is paid over the lifetime of the policy is based on the company and the type of life insurance policy. Agents usually receive the bulk of their commission from a sale the first year the policy is sold, with lessening returns over time. This is part of what makes a life settlement such a great option for agents and their clients alike. Agents get to have more of a return on the policy after they haven’t planned on that income, while policyholders get far greater returns on their investment than the surrender value.
Did you know you can sell all or a portion of a life insurance policy, even term insurance? Selling an unwanted life insurance policy is no different than selling your car, home or any other valuable asset that will create immediate cash. Contact us today to learn more.
Life Settlement Advisors