If you plan on working in insurance, then you will need to learn how to become an insurance agent. Becoming an insurance agent is a great career choice, as it gives you plenty of flexibility, and you can typically complete the entire process of becoming an agent in a matter of weeks.
1. Confirm You Meet the Basic Requirements
Before you even start the process of how to become an insurance agent, make sure that you meet the minimum requirements. These are usually simple to meet. You will need to be 18 years old or older and will need either a GED or high school diploma.
You will also need to be able to pass a background check. If you don’t meet one of those requirements, then wait until you do.
Remember that you will also have to pass a licensing exam, but we will discuss that in more detail.
Consider Extra Education
It will likely be easier to find a job in insurance if you have a bachelor’s degree in a relevant field. Some good options include finance, economics, business, and marketing. You may also want to take some courses in risk management.
2. Know What Type of Insurance Agent You Plan to Be
One of the most important steps to how to become an insurance agent is to figure out what type of agent you want to be. There are two main options: captive or independent.
If you are a captive insurance agent, then you just work with a single insurance carrier or company. They will likely train and support you in exchange for you only selling their policies. You will also likely have to sign a non-compete contract.
By contrast, as an independent insurance agent, you work with multiple insurance companies. You will have more flexibility in terms of the products you can offer, but you will also get significantly less support. You should not expect much training either. On top of that, you will have to build your brand. That means that being an independent insurance agent is more challenging, but it can also be more rewarding.
3. Know What Type of Policies You Want to Sell
You also need to figure out the types of policies you want to sell. Some of the options include:
- Casualty insurance
- Health insurance
- Life insurance
- Personal lines insurance
- Property insurance
- Surplus line insurance
- Variable products insurance
Remember that you can choose to sell multiple types of insurance policies.
4. Know the Local Licensing Requirements
One of the complications in how to become an insurance agent is the fact that every state has slightly different requirements. That being said, most will have two main types of licenses.
Getting a property and casualty license will let you sell business, home, and auto insurance. Getting an accident, health, and life license will let you sell health insurance, life insurance, and insurance related to accidents.
5. You Will Have to Pass the Licensing Exam
To receive the relevant license(s) in your state, you will have to pass an exam. In most states, this involves taking a pre-licensing class. The exact requirements vary by state, with some just taking one day and others requiring 40 hours of training. Some are online, while others are in-person.
When it comes time to take the licensing exam, the test will likely be primarily multiple-choice questions.
6. You Will Have to Apply for Your License
After passing the licensing exam, you will have to apply for your license. This will usually include a background check, and you may have to provide fingerprints as well.
7. Look for a Job
Once you have your insurance license, you can go ahead and look for a job. Even if your ultimate goal is to run your own insurance agency, it is still smart to work with experienced agents first. This will help you gain the experience you need before opening an agency. That is especially important as you will gain on-the-job experience that will be essential to attracting customers and getting approval from insurance companies to sell their products. You will also get experience with various pieces of software and agency management systems.
As you look for a job as an insurance agent, remember that every agency will have different requirements. The bare minimum will be to have your insurance license. Some may also require you to have a relevant associates or bachelor’s degree, potentially including specific courses.
If You Choose to Be Independent
As mentioned, it would be very hard to start your own insurance agency without any prior experience, but it is technically possible. To do so, you would have to apply directly to the various insurance companies to be able to sell their products. However, most major companies will not approve you unless you have experience. In the meantime, you will likely want to use an agency network.
After being approved to sell insurance from specific companies, you can start to find clients and build your book of business. From there, the sky’s the limit!