Answering The Big Question: How Much Do Agents Make?

TLTR: This article answers the question of “how much do agents make?” and explains why now is the best time to be an insurance agent. 

If you’re considering a career as an insurance agent, you’ve no doubt wondered how much you could earn.  According to a study from the Bureau of Labor Statistics, insurance agents made an average of $52,180 annually and $25.08 per hour in 2020. Those can be enticing figures, especially When you consider that this is a job that doesn’t require a college degree. 

But insurance is a vast and dynamic field. So, you need to first decide what type of insurance agent you’re best suited for being. The choice has significant bearing on how much money you can make.  

These are the two basic types: 

  • Captive agents work for a single insurance company. They are only allowed to sell the policies that their parent company offers. 
  • Independent agents can work for a variety of insurance companies. They can sell policies from multiple agencies.    

how much do agents make average

In this blog

How do agents make money?

The primary source of income for agents is residual commissions. Unlike insurance brokers who work for their clients rather than insurance companies, insurance agents receive a percentage of the annual premium from insurers. These companies will keep paying the agent as long as the sale continues to generate money. Furthermore, some insurance companies even pay flat upfront fees to agents for linking them with clients.

The amount of money you make also depends on the type of insurance you sell.

Those who sell property and casualty insurance can earn commissions from the sales of several lines of policies. P&C insurance encompasses several categories such as business liability, personal auto policy, commercial auto insurance, boat insurance, homeowners insurance, and even pet insurance. As a P&C broker, you can either choose to sell one specific type of policy or specialize in selling multiple types of policies to a broad spectrum of clients.

Someone who sells homeowners insurance and car insurance can expect to earn commissions from both the premiums as well as a portion of the policy renewal. So, this means that the chances of increasing your earnings improve with the growth of your client network.

Similarly, those who sell life and health policies earn upfront commissions from their companies, albeit at lower commission rates on renewals.


What’s the most an agent can expect to make?

According to the Bureau of Labor Statistics, the upper 10% of insurance agents earn $125,000 annually. The bottom 10% earn around $25,000.   

The rate of commission you receive from insurers can depend on the type of agent you are. Hence, independent insurance agents earn anywhere from 10% to 25% commission on policies sold. Captive ones make around 5% to 10% commissions.  

Someone who specializes in life and health insurance can make upwards of $90,000 a year by selling a couple of policies per week. But someone who sells car insurance would need to sell a greater number of policies to reach that income level. 

Those who meet their sales goals usually receive bonuses on top of their commissions. Bonuses are also sometimes given out when agencies meet their profit targets.  

basic compensation how much do agents make

The Bottom line…

Working as an insurance agent can potentially be a lucrative endeavor. And all you need for insurance sales jobs is a high school diploma.

Compared to other professions in America, income for agents is generally favorable and employment outlook. Perhaps that’s why the employment of insurance agents is estimated to grow by 5% by 2029. Furthermore, according to the Insurance Information Institute, there were 5,965 insurance companies in 2019. The numbers are likely to grow in the years to come.

Given these statistics, it’s safe to say that the best time to become an insurance broker is right now.

So let us help you transition into the best insurance salesperson that you’re capable of being.

You can add your listing on our agent directory and stay one step ahead of the crowd.

Did you find this blog helpful? Let us know in the comments down below.


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