How to Become an Auto Insurance Agent in 2024
If you're wondering how to become an auto insurance agent, the first step is to check the educational and licensing requirements. For instance, it costs anywhere from $70 to $350 for everything you need to get a car insurance license. We'll overview some of the car insurance agent requirements below.
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Tim Bain
Licensed Insurance Agent
Tim Bain is a licensed insurance agent with 23 years of experience helping people protect their families and businesses with the best insurance coverage to meet their needs. His insurance expertise has been featured in several publications, including Investopedia and eFinancial. He also does digital marking and analysis for KPS/3, a communications and marking firm located in Nevada.
Licensed Insurance Agent
UPDATED: Feb 15, 2024
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
UPDATED: Feb 15, 2024
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
- Educational and licensing requirements for auto insurance agents vary
- Many insurance companies provide on-the-job training
- Agents may earn a base salary but most of their earnings come from commissions
Learning how to become an auto insurance agent can lead to a lucrative and interesting career. So how do you become an agent? You may also wonder if you qualify to become an insurance agent and whether you can earn enough doing it.
While most of the best auto insurance companies require either a degree in business or finance or a college-based insurance course certification, other companies prefer to do their own training and don’t require a degree.
Overview of Auto Insurance Agents | Details | Source |
---|---|---|
2019 Annual Median Pay of Insurance Sales Agents | $50,940 | U.S. Bureau of Labor Statistics |
Typical Education for Entry Level | High School Diploma | U.S. Bureau of Labor Statistics |
Number of Jobs in 2019 | 501,300 | U.S. Bureau of Labor Statistics |
In addition, acquiring a car insurance broker license usually involves a training course and exam. However, if you want the relative freedom the insurance industry offers its agents, and if you have the drive to help people save money on their insurance and get the right protection for their families then there are plenty of reasons to become an insurance agent. We’ll help you learn how to get your car insurance license below.
Use our free search tool to find auto insurance quotes near you before learning how to become an auto insurance agent. Enter your ZIP code above to get started.
Requirements for Becoming a Licensed Auto Insurance Agent
Licensing and educational requirements vary from state to state, so you’ll want to do some additional research and perhaps talk to someone who’s already in the industry. But some general information about these requirements will likely help you to focus your research so you can reach your goal more quickly.
Educational Requirements
You’ll need a certain baseline education to become a car insurance agent. Some of the larger, national companies require a degree in business or finance in order to qualify. Others may accept a college course certification in the insurance field. This option may be met in two years or less, rather than the four years required for a degree.
Conversely, there is an abundance of companies that don’t require a degree or certification, and some even prefer agents without it. This is because they prefer to train agents themselves so that the prospective agent learns to do business the way the company does instead of the way learned at a college or university.
Companies that provide on-the-job training provide the distinctive advantage of being able to start earning right away while learning about the different types of auto insurance. The time you invest in training and qualifying for the license is also time spent earning money and gaining experience as an agent.
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The key is to gain a basic understanding of the factors that affect auto insurance rates and how the insurance system supports drivers.
Licensing Requirements
As with education, licensing requirements also vary from state to state. However, no matter what state you’re in, a license is required. This usually involves taking a training course, passing an exam, and getting a background check. The exam fee runs anywhere from $40-150, and the background check is from $30-200.
The process can take anywhere from 3-6 weeks, depending on how complex the training requirements and background checks are for each respective state. You should research more about your state’s licensing requirements if you want to learn how to get a car insurance license.
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How Much Auto Insurance Agents Earn
How much do auto insurance agents make? The median annual wage for insurance sales agents as of May 2021 was $49,840. However, the actual earnings are really up to each agent, since auto insurance agents are usually paid on a commission basis. While some companies offer a base salary, it’s generally minimal, and the agent will need to sell policies to earn enough money.
So, how much commission do auto insurance agents make? The average commission for car insurance brokers is 15-20%, and some companies also offer annual bonus incentives.
Another factor in salary is the type of agent you choose to be:
- Captive agents: Captive agents sell for only one company. That company may pay a base salary plus commission, and the agent can qualify for annual company bonuses. They represent a specific brand and their advertising would promote that brand.
- Independent agents: Independent agents sell insurance for a variety of companies. They basically do comparison shopping for their clients to find the best rates and coverage. They create their own brand and usually get higher commissions, but they don’t receive a base salary or employee benefits.
Both types of agent positions have pros and cons.
More About Becoming an Auto Insurance Agent
Armed with the educational requirements for your state and the company you’re interested in being an agent for, you’re free to start the process for qualifying. If the company prefers on-the-job training, you can “earn while you learn.” Expect to pay between $70 and $350 for the exam, background check, and car insurance license, depending on the state you’ll operate in.
Commission-based earnings allow you relative freedom over your finances, and the choice between being a captive or independent agent gives you control over how you earn.
If you’re ready to be an insurance agent and want to learn more about rates, entering your ZIP code below gives you access to auto insurance quotes from America’s top providers.
Frequently Asked Questions
How do I start the process of becoming an auto insurance agent?
To become an auto insurance agent, start by researching the specific requirements in your state. If on-the-job training is preferred, you can apply directly to companies that offer training programs. Expect to pay exam and licensing fees, which vary by state. The choice between being a captive or independent agent will also impact how you pursue your career.
Can I sell other types of insurance as an auto insurance agent?
Yes, many auto insurance agents have the opportunity to sell other types of insurance as well. This can include homeowners insurance, renters insurance, commercial insurance, and more. Expanding your product offerings can help you serve a broader range of clients and increase your earning potential.
Are there professional organizations for auto insurance agents?
Yes, there are professional organizations and associations specifically for auto insurance agents. These organizations provide resources, networking opportunities, and professional development programs to support agents in their careers. Joining such associations can help you stay connected to the industry and access valuable resources.
Can I work as an auto insurance agent from home?
Yes, many auto insurance agents have the flexibility to work from home. With the advancements in technology and digital tools, it is possible to conduct most of your agent activities remotely. However, some agents may still prefer to have a physical office or meet clients in person, depending on their business model and client preferences.
Do auto insurance agents need to renew their licenses?
Yes, auto insurance agents need to renew their licenses periodically. The specific renewal requirements vary by state, but they typically involve completing continuing education courses and paying renewal fees. Staying up to date with changes in the insurance industry through ongoing education is important for maintaining your license.
Are there opportunities for career advancement as an auto insurance agent?
Yes, there are opportunities for career advancement as an auto insurance agent. As you gain experience and establish a successful track record, you may have the chance to move into leadership or management roles within your agency or insurance company. You can also explore specialized areas of insurance or consider starting your own agency.
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Enter your ZIP code below to view companies that have cheap auto insurance rates.
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Tim Bain
Licensed Insurance Agent
Tim Bain is a licensed insurance agent with 23 years of experience helping people protect their families and businesses with the best insurance coverage to meet their needs. His insurance expertise has been featured in several publications, including Investopedia and eFinancial. He also does digital marking and analysis for KPS/3, a communications and marking firm located in Nevada.
Licensed Insurance Agent
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.