Is a career in Insurance sales a good decision?

Question

My husband currently works in restaurant management. Good pay,but he works every other day for 16 hrs. on his feet. The company just hired a new district manager & is now trying to show his authority. My husband has been with the company for 2 years and enjoys the customer service aspect, but as many of you know, restaurant management is very difficult. He has been given an offer to make a career change in insurance sales. They said they would give him 1/4 of their existing clients and mentor him to start out. We would have to try to adjust to a 1099 lifestyle. He would also be home every night with his family and home on weekends, which never happens now. Is this a wise career move? Just wondering if anyone could give some advice or questions he should ask before accepting this job. Thanks in advance for the help!

Answer 1

I spent nearly 3 yrs working for an Insurance Company. I didn't make a dime.

However, I worked for an Agent as a Service and Sales person. I got a piece of the inital policy sale, but no residuals.

I've had friends go the big sale route and seen some flourish and others fail.

Some key things to know about:

What are the company quotas? Does your husband need to produce x number of policies each month or they drop him?

What's his payout on the 1/4 that they give him? Are they older policies that are on the lowest tier of commissions? If it's Life Insurance, are they the older crowd that may all die off over the next 10 years? This would force to not only find new business, but find new business just to replace the lost business...

Does your husband have small business experience? Does he, or can he build, a team of trusted people to: structure his company correctly, do his books, generate leads, etc.?

Is he looking to be Self Employed or a Business owner? As a Self-employed person he must keep working to keeep the income flowing in. As a Business owner he should eventually be able to walk away from the office and still have it make money via the people he's hired. Sales, service, etc.

Answer 2

Well that depends on your motives. The biggest immediate difference, other than completely different traits required for the job, would be the volatility in the pay and the steep learning curve.

I don't doubt your husband is intelligent, but to be successful in sales, you need to know all the products inside and out, and also know the person you are selling to so you can cater to their specific needs. As long as your husband is pleansant, the rest will take care of itself. With insurance, and the many different levels, it might take some time for him to get familiar with the product. It's not like cars where people have a good idea of what they're looking for.

Secondly, sales is a very upbeat, fast paced, and dynamic environment. Some personality types have a very difficult time coping with all the movement, so make sure it's outlook and personality are suited for the position.

You shouldn't worry about the 1099 adjustment. I recommend, and this is the safest recommendation, to put aside the money you would have paid in taxes into a CD or money market account. At the end of the year, you'll surely have a surplus of a few hundred dollars.

If money is his sole reason for the job change, and his heart is not in it, I would recommend against it because in sales, ultimately, you're selling yourself.

If he's unhappy with his job, and sales is something he's been pondering, and he's willing to take an immediate paycut for the potential to make much more later on, and you are financially secure until that happens, I think it's a wise career and life move.

Either way, I wish you both the very best luck.

Answer 3

You say that he'll be home every night and home on weekends, but let me assure you that is likely NOT the case if he's new in the business. (Over the long haul, if he makes it past the first five years or so, he's likely to start doing well enough that he won't have to work 80-100 hours a week. But there are no guarantees of that.)

Look, any kind of commissioned sales job can be a ROUGH gig. It can also be extremely rewarding in the long run, if you can stick with it long enough and push yourself hard enough.

But if he's considering changing jobs as a means of shortening his workdays and/or getting away from pushy management, he's definitely barking up the wrong tree. The fact is, sales managers are notoriously brutal and a lot of companies will flat out fire you if you don't meet your quotas in the early years.

Don't get me wrong -- it's been good to me overall. But I swear, I thought I was going to freeze to death the first two winters I was working in this industry, because I couldn't afford to even heat my house above 60 degrees. (Actually, I only heated it that much because I was afraid not to, lest the pipes should freeze!) When I say that it's rough the first few years, I'm NOT joking.

So, if he's prepared to do what it takes to prevail and not afraid of the difficult road to get there, it may very well be a good choice for him. But he definitely needs to go into with his eyes wide open.

Answer 4

I would say, "Yes." The key is offering a quarter of the current clients. Your husbands must be very well-regarded to receive that offer as that's a huge residual income (insurance agents get paid everytime clients renew insurance.)

What he has to find out though is whether this is something he wants to do the rest of his life. Moving into a field because it's good money is no fun and it can drain your energy even more than spending 16 hours on your feet. Your husband needs to figure out what he loves and do it. If insurance is something he'd really enjoy, go for it. Otherwise, find an area that will work.

Answer 5

I've heard from 4-5 people that used to be insurance salesman that it's a real rat race. A constant battle of beating the bushes for new leads and lots of irritated people hanging up on you and closing doors in your face. You're only as good and safe as last months sales. And 1099? blech. I feel you will be making a mistake. Insurance salesman is more of a job for someone going to school headed toward a better career. Alot of slimeballs and backstabbing for leads. Now if your husband is cunning and a lil dishonest and a good salesman, maybe, if not, bad move. 16 hours every other day actually sounds nice to me, every other day at home? if he really hates that I would consider looking for another job in the same career or something a little more stable than insurance sales. ESPECIALLY if you live week to week month to month.

Answer 6

You received a lot of good answers. I'm in the insurance business, working for a niche insurance carrier. We're the ones how supply the independent agents with one (of many) products.

One thing I see that you'd really need to evaluate is what type of insurance is he selling? Property/Casualty (break that down into personal and commercial insurance lines), life, health, disability?

Each one of those industries has a different model. And each entitity (agent, broker, company, etc) offers plusses and minuses.

I sold life insurance at first. What a grind. First, they put me on a draw against commission which barely covered my bills. I cold called every day into businesses to get appointment to sell buy/sell, business life, etc. and every evening into homes to try to sell individual life insurance. It was exhausting. I left because I had sold a bunch of product but couldn't get onto straight commission. They kept me on financing. I couldn't make ends meet and eventually moved on.

I've sold homeowners, auto and business insurance at the independent agency level. Not too bad but still a lot of nights and weekends.

Eventually I got into Agency Management with large insurance companies on the Property/Casualty side and have found this is a good balance between working hard during normal business hours and having a life after work with my family. Perhaps he should examine that route if insurance is interesting to him.

You really need to examine the compensation plan of whatever you're considering very closely. That 1/4 of their clients...is he earing residual commissions on them? Is his job to service that book and cross sell new business into those accounts? Drum up new accounts? Is he on a quota? What happens if he falls short and how much time is he given to make up the shortfall? There's so much to consider and I could go on and on.

It sounds like he's going to be working, based on what you've outlined, for an agency of some sort or he'll be a captive agent for a company (one that sells only one company's products). It's the 1099 thing that's the giveaway. As a 1099 contractor, he's likely not to receive healthcare or any other benefits. That should factor into the decision as well.

It's never easy leaving one business and transferring to another. The key to insurance sales is being extremely persistant without being annoying and being so bullet-proof that rejection rolls of your shoulders, because it is an industry rife with rejection. You can make anything from a pitiful existence to a tremendously rewarding lifestyle. But it's hard work and it won't end at 5:00.

I used to think that the most honest advertisement for companies looking to hire insurance salespeople is , "Make the first of 3 million phone calls by calling us".

Good luck whatever you decide.

Answer 7

The insurance industry is still very much a good old boy network. You're husband will be spending a lot of time shmoozing. Its part of the job. If he is outgoing, good looking, and smart he will probably do well. It also depends on the type of insurance he will be selling. In order to make a lot of money in insurance, it would be good to get his broker's lisence maybe even his CPCU.
Insurance sales can mean a lot of different things. If he is going to be acting as an agent who is getting insurance for insurance buyers than he will work very hard for the first few years building his renewal book. If your husband will be eanring a commission, he will be working hard at first to write as many deals as possible. He will want these deals to renew. Over time he can concentrate less on getting new business and concentrate more maintaining renewals.

Answer 8

You should def. check out this insurance company really well. Sometimes they tell you a bunch of **** just to get you to make money for them and not a lot for yourself. I'm not saying that all insurance sales jobs are bad...just that some of them are not in your best interest.

Answer 9

I have known three persons who went into selling insurance. All said that as soon as they did not meet their new client quota, they were let go. All of them did most of their business on weeknights and weekends because that was when their (potential and existing) clients did not work and were available.

Answer 10

Many people have prospered from insurance sales but it is very competitive. (especially at first) Just make sure he hooks up with a good company that has a good reputation in your area.