How does one become an Independent Agent if the life insurance and annuity business?

Question

Meaning, If you are first starting out in the insurance business(no history), how do you get the commission level of the independent agents? Do you just have to sell a certain amount of insurance or annuities, like 1 million worth, then you are pushed to the independent agent status, or is it that you have to have umpteen years of experience selling a certian amount of insurance before they would consider you for the indepedent agent status.
Also, I heard that there were these companies, like FSD Financial Services, they let normal agents sign up and I guess if you go throught them (which seems like a middle man between them and the actual insurance companies) you can get the independent agent status and commission levels right away. Its like there a big company with EX: New YOrk life and they (FSD) automatically gets the bigger commission becasue of their status with the company, so that means any of their agents get the same bigger commission.Then Maybe agent pays FSD small fee.

OK, If an independent agent means you can work for multiple companies. Then does that mean you get that higher commission. What i mean is normal indepent agents get 90% commission of insurance and 5-10% on annuities right?, but regular agents (who i assume work just for one company ex: new york life) only get like 55% on insurance and 3-5% of annuities. What makes an agent get those HIGHER commission levels?

Answer 1

In order to sell life insurance, you would need a life license.
In order to sell annuities, you would need a life license and a securities license.

I'm not sure how the commission structure work for all insurance companies, but I believe you do need to put in a certain amount of premiums in a month in order to upgrade your sales level. Well, that's what I was told when I was interviewed by several insurance and financial companies.

When a company markets other companies products, this is called an agreement. Let's say you work for company ABC and they have an agreement with XYZ to sell XYZ's annuity products. If you sell XYZ's products, XYZ will pay ABC a certain amount of commissions and then ABC will pay you for selling it.

Answer 2

1

Answer 3

Independent Life Insurance Agent

Answer 4

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i went through the same thing you did. for me i think it is better to be independent because you can have the best product at all times. The only advantage i had as being a career agent was the company provided leads, but only for a limited time. then they expect you to do everyhting for yourself. If you need training because you are new in the business, i would start out as a career(company) agent and use them for the training. I get a higher contract being independent, therefore i get paid more. Some people say you are on your own being independent, that is not true, marketing company's have plenty of training and knowledge and thats where you get your contracts. i use a couple different marketing organizations for each line of products.... 1 for senior health and life, another 1 for annuities and another for major medical. they all have lead programs around 375 per 1000 mailed leads. contact me by email if you want more specific info. You dont have many choices being a career/company agent.

Answer 5

Becoming a life insurance agent may be one of the most challenging, but rewarding careers. Finding people who need your services and products is not easy, but you will be putting food on people’s tables and keeping the roofs over the heads after a primary wage earner has died. People will never turn you away when you are in the process of delivering a check.

You don’t need much education to be a life insurance agent. The law requires only that you pass the licensing exam for your state ad that you obtain an appointment with the company or companies of your choice. You don’t need formal education or experience although if you have had sales experience, it can help with developing your success story.

Answer 6

An Independent Agent means that you can sell insurance for more than one company. You're not locked into selling only New York Life only. A New York Life agent is an employee of New York Life.

The first thing you need to do is get a license to sell insurance and to do that, the you'd need to work for an insurance company or another independent agent or broker first and learn the insurance business. Once you know what you're doing and actually have some knowledge of insurance, you take a state test. If you pass, you get a license. You can't sell anything until your licensed.

Additional Answer: You don't "work" for multiple companies. You have agreements with those companies to sell their products. What deal you work out with them as to what commission they're going to pay you for selling one of their products is up to you but if you find someone that pays you 90% commission, let me know who it is. If they're paying you 90% of the premium, I don't know how they're making any money on the deal.

Commission rates vary depending on the product. There are way too many variables for me to give you any kind of definitive answer. But, in my experience, the more you sell for a company, the more you'll likely get paid. eg, they're going to be willing to pay an agent that sells a million dollars in premium a higher rate of commission than an agent that sells a half million.

You can make good money selling life insurance but it generally takes a lot of experience and knowledge before you get to that level.

Answer 7

Independent agents get a little higher FIRST YEAR commission because they develop their own prospects and clients at their own expense.

An independent agent - as opposed to a "captive" or "exclusive" agent, may have sales and marketing contracts with several companies; whereas, the captive or exclusive agent sells for only one company, or it and its affiliate companies.

Another reason the captives get a little lower comp is that they often are provided with an office, phones, letterhead, postage, mailing lists, orphan policyholders, support staff, and tons of other support materials that would cost the independent agent out of their own pocket.

If you're just starting out, going with a captive company like NY Life, Prudential, Metropolitan, etc. can be a good decision. Many of them will give you good training, pay you a short term starter allowance (helps keep the lights turned on while you learn the ropes), give you a recognized name to rep, and help you develop your clientele. They'll ride your b-u-t-t to make sure you get outta bed in the morning and work, but that helps develop good successful work habits.

It's not an easy biz to start in. 2/3 fail in the first year, so any advantage you get by going with a captive company is worth the few percent comp you give up to be there.

Believe me. I've trained over 10,000 agents in my career.

Answer 8

Part Time Insurance Agent

Answer 9

I am an idependent life agent. I work part time now, as I have a regular 9-5, but the extra bit that comes in helps. I really do like the fact that no one is all on me everyday! That is one of the reasons I left a captive agency. But I would have to agree somewhat with View from a Horse, if you are just starting in the business, you want to get some experience & knowledge first. That way you will know what you are talking about. Remember, as an inde, you dont have someone to always go to. Its a good idea for you to get that base of knowledge 1st & see different situations. Not discouraging you at all from doing it, but I would not want you to get frustrated & burned out early because of lack of experience & knowledge.

Yes, the % is fantastic! One of the companies I write for pays 105% for whole life & 30yr term; 100% for 20 & 25 term; 90% for 10 & 15 terms. The annuities range from 6%-9%. And the client rates are very good also. Faye, email me if you want, I can give you info.

You can be independent from day 1 if you want. There is usually no time that you need to be in there. Most companies offer great prizes like trips to great locations if you sell a certain amount (usually not that high!). You dont pay them any fees directly, they get theirs in overides & renewals. That is why depending on the agency (the agency matters also), you could get a large varience in commissions from the same company. I saw one agency (from the one that pays me 105%) paying only 85% to others. You should get a certain amount in renewals also each year.

Also, when independent, dont forget that you are responsible for all costs & fees associated with your license like: CE courses, renewal fees, advertising, tracking CE credits, classes & test taking, and of course good old E&O coverage (mine is about $69/month). Those are the nice things that when you work for a company, they pick up fees like those & why you have a reduced commission; they pay most of those for you & give you office space & leads.

Answer 10

There are many threads about that at www.insurance-forums.net You should read through them. they will walk you through getting appointed at high contracts, marketing, product info etc..