How to Become an Independent Insurance Agent: Is it Profitable?

how to become an independent insurance agent
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Independent insurance agents assist clients in locating the best plan to suit their requirements while taking advantage of the independence and earning opportunities that come with working for yourself. Does this seem like a profession for you? You can have a great career as an independent insurance agent with a little bit of willpower and dedication. Here’s how you can get started.

Who Is An Independent Insurance Agent?

Insurance agents can be divided into two categories: captive and independent. While independent agents, often known as insurance brokers, can enter into contracts with multiple carriers and sell policies for each of them, captive agents can only sell policies for one insurance carrier.

Independent agents might be more aggressive in their sales strategy because they aren’t restricted to a single carrier. For instance, if a prospect’s demands aren’t met by a certain auto policy from one carrier, the agent can present a number of additional options and rates from other carriers. Independent agents can specialize in one type of coverage or provide a variety of options, which gives them a lot of freedom. One coverage line can be added initially, and as their network and clientele increase, they can gradually add more.

Independent agents are not always welcomed by insurance companies, but many of them do. There won’t be a scarcity of possibilities for policies to sell if you work as an independent agent.

How to Become An Independent Insurance Agent

The path to becoming an independent insurance agent is very rewarding and not prohibitively expensive. While some states have specific standards that are different, most have a similar procedure. Future independent insurance agents should adhere to the following steps to enter the field and position themselves for a long and prosperous career:

#1. Educate yourself

A GED or high school diploma is required to work as an independent insurance agent. A bachelor’s degree in business administration, marketing, or finance may enhance long-term job opportunities. Some universities even have a major in insurance.

To be eligible to apply for a license as an independent insurance agent, prospective agents must pass a test in each state. Candidates should finish a study course that covers both the test material and non-test insurance issues before taking the exam. Some insurance businesses also provide in-house training under the supervision of a certified insurance agent so that the applicant can have a feel for the business.

The precise prerequisites for taking the exam vary by state, with some asking the candidate to finish a training program before taking the exam and others having no such requirements. Find out about the particular criteria from the state licensing organization.

#2. Complete license requirements

A license can only be obtained after passing the license exam. No criminal history is required for those aspiring to become licensed independent insurance agents. Applicants with minor transgressions on their records, such as moving tickets and other non-violent crimes, may be accepted by several states. It is best to inquire about the exact qualifications and expectations from your state’s licensing board. An additional typical criterion of state licensing boards is passing a background check. The fingerprints of applicants are frequently also recorded. Such measures are intended to stop fraud and dishonest behavior.

#3. Obtain a license.

A candidate can apply for and obtain a license to sell insurance products after passing their insurance exam and providing the licensing board with their details. Occasionally, but infrequently, a candidate must submit an application for a license in order to sell each distinct form of insurance product.

#4. Look for a job.

Although it may be challenging, it is not impossible for a new independent insurance agent to find clients. All of these persons, including relatives, acquaintances, and previous coworkers, might be contacted. Agents that deliver excellent service have a solid reputation that increases their opportunities. On rare occasions, an insurance provider or seasoned insurance broker would provide new independent insurance agents with on-the-job training and employment.

#5. Promote

New agents need to promote themselves to prospective clients as well as insurance providers. Although local advertising may be more affordable than online advertising, both must be done in order to reach as many potential customers as possible. To contact more potential consumers, new independent insurance brokers can want to request recommendations and referrals. Word-of-mouth referrals are crucial when you’re just starting business.

#6. Keep learning.

Independent insurance agents must stay current on legislative and industry changes in order to offer their clients the best possible service. Independent insurance brokers can enhance their job chances by pursuing courses, going to conferences, and attending lectures and seminars. The majority of states require insurance agents to maintain their education as part of their requirements.

#7. Obtain insurance.

The acquisition of general liability, workers’ compensation, and errors and omissions coverage is advantageous to all independent insurance agents. An unproven firm is shielded from financial danger by insurance. In particular, the Errors and Omissions policy is crucial. This policy, which was specifically designed for independent insurance agents and people in related fields, shields independent insurance agents from claims from clients resulting from errors made by the agent or their staff that render the client uninsured.

How Do I Become A Texas Independent Insurance Agent?

Those seeking for a new profession have a lot of options in the insurance sector. You might be interested in working as an insurance agent and wonder how to begin. The procedure is reasonably straightforward and can be finished online in Texas.

  • To obtain a license, one must be at least 18 years old.
  • A high school diploma or its equivalent is required.
  • A test for insurance is required.

In Texas, you must be 18 years old and have successfully completed a pre-licensing education program in order to obtain a license to sell insurance. Additionally, you must succeed on the state licensure test.

The pre-licensing education course must receive approval from the Texas Department of Insurance and be at least 20 hours long. The following subjects must be covered in the course:

  • The insurance industry
  • Legal guidelines
  • Ethics
  • A description of the various types of insurance coverage
  • How to figure out premiums
  • How to promote insurance sales
  • Insurance laws and rules in Texas

You must pass the state licensing exam after finishing the pre-licensing course. The test is given by Prometric and has two sections:

A multiple-choice general knowledge test covering the aforementioned subjects makes up Part 1.

A state-specific law test makes up part two.

To obtain a Texas insurance agent license, you must pass both sections of the exam. By visiting the Department of Insurance website, you can start the process of becoming an independent insurance agent if you satisfy the aforementioned conditions.

How To Become An Independent Insurance Agent In Georgia

These are the stages required to become an independent insurance agent in Georgia:

#1. Select the insurance type you want to market.

#2. Examine the license requirements. The Georgia insurance licenses that are offered are shown below.

  • Credit
  • Life, mishaps, and illness
  • Individual lines
  • Real estate and casualty
  • Permanent resident
  • Travel-related products

#3. Complete the prerequisite courses for your license.

#4. Make an appointment to take your exam and be prepared with the following:

  • Legal name, residence address, Social Security number, and contact information
  • Name of the institution where you received your pre-licensing education, or the institution code that you attended
  • Preferred test date and testing facility
  • A system for paying the exam price online
  • Amass the materials you’ll need for the test.
  • First and second names
  • Certificate of pre-licensing education
  • Georgia life examination score report passing if you’re a candidate for a variable product

#5. Take the test and find out the results.

#6. Fill out the citizenship affidavit if you passed.

#7. Submit a licensing application

#8. Complete registration with fingerprints

How To Become An Independent Insurance Agent In Florida

There are particular requirements in Florida to become an independent insurance agent.

#1. Finish the Florida pre-licensing coursework. You will need to finish a certain number of education credits that have been approved by the state. Depending on the license you want to get, these hours change. You’ll receive a certificate once you’ve finished the course.

#2. Fill out an application for a Florida insurance license and pay the required fees via Florida’s Agent and Agency Services page.

#3. Finish your background check and fingerprints. Your fingerprints will be automatically forwarded to the Florida Department of Law Enforcement and will incur an additional cost.

#4. Take the exam that corresponds to the insurance line you want to carry.

Finally, you will receive your insurance license provided you pass the exam, your application is authorized, and your background check is successful.

How Profitable Is An Insurance Agent?

The typical profit margin for insurance agency owners is from 2 to 10 percent.

Which Type Of Insurance Gets Paid The Most?

Selling life insurance is the insurance industry job with the highest pay.

Who Is The Highest Paid Insurance Agent?

With annual commissions exceeding Rs 7 crore (about $70 million), Gideon du Plessis is currently the highest-paid insurance agent in the world.

In Conclusion

For those looking for a flexible lifestyle with the possibility to help others and perhaps make a high income, becoming an independent insurance agent offers a wealth of opportunities. Independent insurance agents are free to work alone and at any time. Additionally, while a bachelor’s degree is not absolutely necessary for this field, it is a viable alternative for people with limited time or finances.

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