How To Become An Auto Insurance Agent
Becoming an auto insurance agent may be easier than you think. In most states, you need a license to sell auto insurance. Some states also require you to take a test.
Are you interested in selling car insurance? Do you want to become an auto insurance agent? With a few basic steps, you can become an auto insurance agent.
Keep reading to discover everything you need to know about becoming an auto insurance agent in your state.
Surety Bonds For Insurance Agents
Most states require a surety bond to sell insurance. Also known as insurance producer bonds, fidelity bonds, and insurance broker bonds, surety bonds offer financial protection to any clients harmed by negligent or fraudulent acts from their insurance agent.
Some states require an entire brokerage to have a surety bond for the company and its agents. In other states, each broker must be individually bonded. The cost of an insurance surety bond primarily depends on the size of the bond purchased.
For example, using the same four states whose license requirements we evaluated:
- California requires an insurance broker bond of $10,000
- Texas requires a $25,000 insurance agency bond
- Florida requires that an insurance agency have a $35,000 surety bond
- Georgia requires a $50,000 surety bond for insurance agencies
How Much Does It Cost To Get An Insurance License
This number will vary greatly from state to state. To find the correct answer for your case, you should check your states license page.
Here is an example from a state with mid-range fees:
- Pre-license Education $200
- Pre-license Education $200
- Insurance Exam Fee $62 per attempt
- Insurance Exam Fee $62 per attempt
- Fingerprinting Fee $31
- License Application Fee $100Grand Total $655
There is a strong possibility that the company that hires you will assist or reimburse you for these fees, so be sure to ask about this when you are interviewing for a position.
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Are There Any Continuing Education Requirements To Maintain My License
Yes. Changes in federal insurance laws, insurance benefits programs and other areas can impact client’s needs. Most state insurance boards require agents and brokers to complete continuing education courses to keep abreast of these changes to maintain their licensure. The Institutes Risk& Insurance Knowledge Group provides a list of each state’scontinuing education requirements for a wide range of common industry certifications.
How To Become An Insurance Agent Faq
How can I find a job in insurance?
The best place to find a job or begin your career in insurance is to use our insurance job board. If you need to update your resume before applying, check out our guide on how to write an insurance resume.
Do insurance agents get paid hourly?
This is dependent on your arrangement with your agency. Some agents are paid hourly, some by salary. These can also be combined with commission splits or bonus structures. There are many ways to compensate an insurance agent, and there doesnt seem to be a prevailing method.
If you are an agency owner, it is almost certain that you will be paid a commission split with your insurance company. This may be supplemented based on your agencys age or performance.
Can you sell insurance without a license?
No. All states require a license to sell insurance. You must also hold the correct license for the type of policies you are advertising.
Example: if you have only a life insurance license, you cannot sell car insurance, but you can sell a term life insurance policy.
Is the insurance license exam hard?
The national pass rate average for first-time test-takers is right at about 50%. Success rates vary by state, license types, and test prep company. We see that folks who study with a pre-license education course tend to fare better on the exam than those who use lesser study materials.
Can insurance agents work from home?
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Should I Join An Insurance Industry Trade Association
Definitely. There are dozens of industry trade organizations that provide members with discounts on continuing education, educational resources, opportunities for professional development and networking, and regional and national conferences where agents can mingle with like-minded peers. These resources can be an important avenue for career growth.
Do You Need A Degree To Become An Insurance Agent
Typically, no college degree is necessary to become an insurance agent.
The minimum education requirement for becoming an insurance agent is a high school diploma or GED. However, many insurance companies may prefer that their agents have a bachelorâs degree.
For this reason, it could be helpful to look into classes focused on business, finance, or economics. Some colleges may also offer classes in insurance or risk management. Studying marketing or even psychology could be helpful to better understand the customer mindset so you can learn the best way to sell someone on an insurance policy.
While a high school diploma will be sufficient, obtaining a bachelorâs degree in one of the discussed fields can be increasingly useful for your insurance broker or agent career.
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Is Being An Insurance Agent A Good Career Choice
Being a licensed insurance agent is an excellent career choice for all different types of people. Younger people see insurance sales to be a great way to add flexibility and grow the size of their network. More experienced folks can leverage the network that they already have and use the career to leverage their savings into large growth.
Benefits Of Being an Insurance Agent
Choosing a career in insurance comes with many benefits. Here are a few reasons you might consider becoming an insurance agent.
These are just a few examples of the benefits of the job. The longer you stay with this career, the more advantages you will garner.
What About Coverage For An Insurance Agent
To provide protection for themselves, insurance agents will typically consider the following policies:
- General liability insurance: This policy covers basic insurance agent risks, such as customer property damage and injuries. It’s often required for commercial leases and contracts.
- Errors and omissions insurance: E& O covers legal defense costs related to work performance, such as a P& C agent sued for negligence in a claims dispute. It’s also called professional liability insurance.
- Business owners policy: A BOP bundles commercial property insurance and general liability insurance under one plan. It’s often the most cost-effective type of commercial insurance for insurance professionals.
- Workers compensation insurance: Most states require workers’ comp for insurance agencies that have employees. It also protects sole proprietors from work injury costs that health insurance might deny.
While insurance and bonds may differ, both are key to a businesss risk management strategy.
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How To Get An Insurance License In California
California requires 20 hours of pre-license education for either a property and casualty license or a life, accident, and health licenseplus 12 hours on ethics and the California insurance code.
Licensing tests must be taken within one year of completing a pre-license education course. Each exam consists of 150 questions. Information on these tests and what to expect from them can be found on the on the California Department of Insurance educational resource page.
Anyone who fails the licensing exam 10 times in 12 months is barred from taking the same exam for another year.
After passing the test, the state requires a fingerprinting and background check before applying for a license with the state.
For more information, check the California Department of Insurance website, or the departments insurance licensing page.
Salary And Job Outlook For Health Insurance Agents
Salary data for health insurance agents specifically is limited, but according to Indeed Salaries, the average national salary for insurance agents in the United States is . This salary can vary based on years of experience as an insurance agent as well as company and location.
According to the , insurance agent employment is expected to increase faster than average in the next few years. This indicates that the job outlook for health insurance agents is promising.
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Which Types Of Insurance Licenses Do You Need
There are two licenses that insurance agents attain:
- Life & Health Insurance License Life Insurance, Annuities, Health Insurance, etc
Most general insurance agents choose to get both of these licenses. Some agents dont have any plans on selling car or homeowners insurance, and therefore only need the Life and Health Insurance License.
We recommend finding which license you need first, working on that one alone, then coming back to get the other license at a later date.
Insurance Agent Work Environment
The average work environment for someone working in insurance is an office setting. If you want to work as an insurance agent, it’s important that you can be comfortable working behind a desk for most of the day. While you may work in a clerical environment, larger insurance agencies often have many agents working at cubicles, providing plenty of opportunities to socialise with your colleagues. In a smaller agency, you may work in your own office or even from the comfort of your home. Many of your duties as an insurance agent require the use of a computer.
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How To Get An Insurance Agentlicense In 2022
TLTR: This article is an in-depth guide to help you understand the process of obtaining an insurance agent license and how to prepare for your upcoming exam. Also mentioned are tips on how to ace your exam!
In 2022, the insurance industry is going to be more competitive than ever. If youre looking to stand out from the rest of the competition and distinguish yourself from the crowd, the first step is to get a license. Without one, you will not be able to sell or represent any type of risk coverage for your clients.
In order to obtain this license, it is necessary that you apply and pass the one-time state-mandated exam and fulfill all of the required licensing requirements. The process can take up to six months from start to finish, so make sure that you are prepared before starting your professional journey.
What Are The Responsibilities Of An Insurance Broker
An insurance broker has many roles and responsibilities, ranging from risk management to providing industry knowledge. Because an insurance broker can either be independent or work within a firm, an individual broker’s range of roles and responsibilities can vary.
Here are nine different roles and responsibilities of an insurance broker:
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Shopping For Car Insurance Insurance Navy Can Help You Out
Get a free auto insurance quote online or call us at 888-949-6289 and see how affordable your car insurance can be when you choose Insurance Navy. We offer great coverage at budget-friendly rates. We also provide our services in-person at one of our many locations.
About the AuthorHayley Crandall is a Senior insurance analyst and writer for Insurance Navy. She enjoys researching and learning all about the world of insurance. She previously worked as a reporter for the Milwaukee Courier covering a variety of topics across Milwaukee, WI. Hayley has a BA in Journalism from the University of Wisconsin-Milwaukee.
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What Degree Do You Need To Be An Insurance Agent
Related
Insurance agents are generally taken for granted until a situation arises and a claim must be quickly filed. The job of an insurance agent can be rewarding when clients express gratitude for helping them through a difficult predicament such as an illness while traveling abroad. According to IBIS World, approximately 412,850 insurance agencies and brokerages provide thousands of insurance agent jobs in the U.S.
The educational requirements to become an insurance agent include a high school diploma and an insurance license, but earning a bachelor’s degree has many advantages. Further, most employers prefer a college degree, according to Indeed Career Guide. Business is understandably one of the best degrees for an insurance career, but successful insurance agents have varied backgrounds.
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One: Acquire A High School Diploma And/or A College Degree
Although a high school diploma is the only educational requirement for an insurance agent, it would be a huge asset to get higher education relating to insurance.
In addition, an insurance agent must understand what motivates people to purchase. Recently, a few colleges like Bauer College of Business and Ferris State University have started offering courses in insurance and sales marketing.
Having people skills will take you considerably far in this career, but a good knowledge of the business world will give you an edge when competing against a rival independent insurance brokerage.
How Do I Become Licensed To Sell Insurance
To become an agent, you need to hold a current property/casualty license and life/health license in your state. To prepare for the state licensing exam you need to take a three-day pre-licensing course or complete a self-study course for each license. A college degree is not required, but having a background in insurance, business or finance can be an asset. Its also beneficial if you have sales experience.
Here are some of the steps that youll need to take:
- Pick a line of business. Agents are required to be licensed for specific lines of business. Knowing what type of coverage you want to sell can help you choose your insurance career path.
- Meet your states education requirement. In all states, you will need to complete pre-licensing requirements. For example, the Pennsylvania Insurance Department requires candidates to complete 24 hours of general pre-licensing education and three hours of instruction in ethics.
- Pass the state insurance exam. Test-takers generally spend 35 to 40 hours studying for the property and casualty exam, which is a timed, multiple-choice test. The number of questions on the exam will depend on the state and the license for which you are applying.
- Apply for a license. One way that you can submit your license application online is through the National Insurance Producer Registry .
- Gain an insurance company appointment. After you are licensed, youll need to apply and secure an appointment with an insurance company.
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Is It Compulsory To Undergo Any Training To Become Certified As A Pos Person
Yes, you will have to complete the training to become a POSP. It will include topics ranging from basics of insurance, policy types, process for issuance and claims, rules and regulations etc.
Yes, you will have to complete the training to become a POSP. It will include topics ranging from basics of insurance, policy types, process for issuance and claims, rules and regulations etc.
How To Get An Insurance License In Texas
Texas does not have education requirements for an insurance license, but you might consider taking a pre-license education course, either in person or online. You can also see an outline of the test to get an idea of the subjects it covers.
Youll have to take an in-person exam for either life and health, property and casualty, or both. Each exam consists of 125 questions. There are no limits on how many times you can take either test.
After passing, you must apply for a license within one year, but first youll have to submit to a fingerprinting and background check.
If you pass the fingerprinting and background check, you can apply for a license. A separate application will be needed for each license you seek.
For more information, check the Texas Department of Insurance website.
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Graduate Degrees In Insurance
Insurance agents looking to advance their careers have options. For example, a 32-credit online Masters in Insurance Management is available through Boston University. The program is geared toward insurance agents with a Chartered Property Casualty Underwriter credential seeking promotion to managerial roles. Experienced insurance agents interested in managing their own agency or brokerage firm may wish to consider a Master of Business Administration, which is widely available online and on campus.
A doctorate degree may appeal to insurance agents who enjoy working with data and technology. Data scientists with a Ph.D. apply their knowledge of machine intelligence and coding language to analyze complex data sets to better inform decisions in underwriting and claims.
Life Insurance Agent Qualifications
As mentioned before, a life insurance agent is not a profession for the thin-skinned or faint of heart. In fact, more than any other factor, including education and experience, life insurance agents must possess a fighting spirit. They must be people who love the thrill of the hunt, the rush of a sale, and see rejection as a stepping stone to eventual success. A career in life insurance sales is not ideal for those who view themselves as introverted, soft-spoken, or afraid of conflict.
The vast majority of life insurance companies have no formal education requirements for becoming an agent. While many prefer college graduates, this general rule is constantly overlooked in favor of the “right” candidates. Previous experience in the insurance industry is not required because most medium and large insurance carriers have internal programs to train their salespeople about the products they’re going to sell.
While it may prove easy for a tenacious go-getter to get hired at a reputable insurance company, there is one non-negotiable hurdle that stands between a potential insurance agent and their commissions: state licensing. Insurance agents are currently licensed by the individual state or states in which they’ll be selling insurance. This generally requires passing a state-administered licensing exam as well as taking a licensing class that typically runs 20-50 hours.
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