How do I become an auto insurance agent?

If you're wondering how to become an auto insurance agent, the first step is checking over the educational and licensing requirements for the job. Read through the guide to find how to become a car insurance agent.

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Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Written by Rachel Bodine
Feature Writer Rachel Bodine

Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent Daniel Walker

UPDATED: May 26, 2022

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Overview of Auto Insurance Agents
Overview of Auto Insurance Agents Details Source
2019 Annual Median Pay of Insurance Sales Agents $50,940U.S. Bureau of Labor Statistics
Typical Education for Entry Level High School Diploma U.S. Bureau of Labor Statistics
Number of Jobs in 2019 501,300U.S. Bureau of Labor Statistics
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Things to remember...

  • Educational and licensing requirements for auto insurance agents vary from state to state
  • Many insurance companies provide on-the-job training so you can start earning money right away
  • Auto insurance agents may receive a small base salary, but the greater part of their earnings is on a commission basis

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. 

In addition, acquiring a car insurance broker license usually involves a training course and exam. But 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.

Use our free search tool to find auto insurance quotes near you before becoming an auto insurance agent. Enter your ZIP code above to get started.

What are the requirements for becoming an 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 will 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 do not 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 car insurance. The time you invest in training and qualifying for the license is also time spent earning money and gaining experience as an agent. The key is to gain a basic understanding of the factors that affect car insurance rates and how the insurance system supports drivers.

Licensing Requirements

As with education, licensing requirements also vary from state to state. But 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.

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How much do auto insurance agents earn?

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. The average commission for car insurance brokers is 15-20%, and some companies also offer annual bonus incentives.

Another factor in salary is what 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.

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 are 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 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 are 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.

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Enter your ZIP code below to view companies that have cheap auto insurance rates.

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