Pay & Salary
Insurance agents are licensed professionals who perform a needs analysis and help their customers find the right insurance products to fit their needs. They play a vital role in ensuring their customer's family is protected from unpredictable financial loss in the future. If you are considering a career as an insurance agent, having detailed salary information can help you decide if it's the right career path for you. In this article, we discuss the states with the highest average salaries for insurance agents and discuss how to become an insurance agent.
What is an insurance agent?
An insurance agent is a professional who is licensed by their state and appointed by at least one insurance agency to sell insurance products to consumers. The role of an insurance agent typically involves making contact with leads either by phone or in-person, completing a customer needs analysis, discussing insurance products that meet the customer's needs and completing insurance applications and screenings. Insurance agents may sell health insurance, life insurance, property and casualty insurance, variable annuities and ancillary products such as dental, vision, accident, disability and critical illness insurance.
There are two types of insurance agents: independent and captive. Independent insurance agents are often appointed with several insurance agencies and can usually offer a wider variety of insurance products than captive agents. Captive insurance agents are appointed exclusively with one insurance agency and can sell only the products offered by that agency.
Related: Learn About Being an Insurance Agent
Insurance agent average salary
When considering the national average salary for a position, it is important to consider the average salary and salary range. There are also other compensation factors to think about when considering a job offer such as overtime pay, bonuses and benefit packages. The national average salary for an insurance agent in the United States is $79,965 per year with a salary range between $17,000 per year and $188,000 per year, although salary rates by profession and region throughout this article will always be fluctuating. For updated salary information, refer to Indeed.
The salaries of insurance agents are often made up of base salary plus commissions and/or bonuses. Independent insurance agents are usually paid commission only, while captive insurance agents are usually offered a base salary and smaller commissions or bonuses.
Related: Base Salary and Your Benefits Package
Insurance agent salary by state
When comparing the average salary of each state, it is important to consider the average salary, the salary range and the comparison of the cost of living for each state to make sure you are getting an accurate picture that will help you choose which location is right for you. Since insurance agents are licensed professionals, it is also important to compare the educational and licensing requirements of each state. Here is a list of the top ten states with the highest average salaries for insurance agents:
- Minnesota
- Maine
- Alaska
- Kansas
- Vermont
- North Dakota
- Nebraska
- Utah
- Iowa
- South Dakota
1. Minnesota
Average salary: $91,199 per year
Percent above national average: 30%
Salary range: $27,000 per year - $192,000 per year
2. Maine
Average salary: $92,024 per year
Percent above national average: 31%
Salary range: $22,000 per year - $210,000 per year
3. Alaska
Average salary: $92,514 per year
Percent above national average: 32%
Salary range: $22,000 per year - $210,000 per year
4. Kansas
Average salary: $93,235 per year
Percent above national average: 33%
Salary range: $28,000 per year - $194,000 per year
5. Vermont
Average salary: $93,371 per year
Percent above national average: 33%
Salary range: $22,000 per year - $212,000 per year
6. North Dakota
Average salary: $93,719 per year
Percent above national average: 34%
Salary range: $47,000 per year - $154,000 per year
7. Nebraska
Average salary: $94,002 per year
Percent above national average: 34%
Salary range: $43,000 per year - $163,000 per year
8. Utah
Average salary: $94,369 per year
Percent above national average: 34%
Salary range: $47,000 per year - $157,000 per year
9. Iowa
Average salary: $95,010 per year
Percent above national average: 35%
Salary range: $36,000 per year - $181,000 per year
10. South Dakota
Average salary: $97,188 per year
Percent above national average: 39%
Salary range: $49,000 per year - $160,000 per year
How to become an insurance agent
If you believe being an insurance agent is the right career for you, follow these steps to become an insurance agent:
- Research your state's licensing requirements. The licensing requirements for insurance agents vary by state. So it is important to research your state's requirements to ensure you know what you will need to do to become eligible for licensing.
- Take an insurance licensing preparation course. Most states require candidates to complete a pre-licensing education course prior to taking the state's licensing exam. This course should cover the state's laws and regulations for the sale of insurance and general information about the different types of insurance products. This pre-licensing course typically takes about a week to complete.
- Study for your licensing exam. You will need to use the information you learn in your pre-licensing course to study for your state's licensing exam. You may also want to consider additional study materials. Most candidates spend at least one week after completing their pre-licensing course studying and taking practice exams before sitting for their licensing exam.
- Pass your licensing exam. The most important step toward becoming an insurance agent is passing your state's licensing exam. Once you pass your exam, you will receive a copy of your state insurance license and can begin applying to jobs.
- Get appointed with an agency. Next, you will need to decide whether you want to work for a company as a captive insurance agent or as an independent broker. Once you have decided which type of insurance agent you want to be, you can begin looking for open positions with an agency. The agency you are hired with will help you through the application process to become appointed with the insurance carriers you will sell products for.
- Maintain your license. You will also need to take continuing education (CE) courses and pass a renewal exam every couple of years to maintain your insurance license. The amount of continuing education credits you are required to take and when you need to renew your license varies by state and may also vary by the number of years you have been licensed as an agent.
Related: Insurance Agent Resume Samples
