Compensation

The median annual earnings of wage and salary insurance agents were $43,870 in May 2006. The middle 50 percent earned between $31,640 and $69,180. The lowest 10 percent had earnings of $24,600 or less, while the highest 10 percent earned more than $115,090. Median annual earnings in May 2006 in the two industries employing the largest number of insurance agents were $46,210 for insurance carriers, and $42,950 for agencies, brokerages, and other insurance related activities.

Many independent agents are paid by commission only, whereas agents (also known as producers) who are employees of an agency or an insurance carrier may be paid in one of three ways: salary only, salary plus commission, or salary plus bonus. In general, commissions are the most common form of compensation, especially for experienced agents. The amount of the commission depends on the type and amount of insurance sold and on whether the transaction is a new policy or a renewal. Bonuses usually are awarded when agents meet their sales goals or when an agency meets its profit goals. Some agents involved with financial planning receive a fee for their services, rather than a commission.

Employer-paid benefits to insurance agents (these agents are called captive agents) usually include continuing education, training to qualify for licensing, group insurance plans, office space, and clerical support services. Other benefits may include attendance at conventions and meetings, promotion and marketing expenses, and retirement plans.

Primary Source: Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2008-09 Edition, Insurance Sales Agents , on the Internet at http://www.bls.gov/oco/ocos118.htm.

Remember, an agent/producer is not the only position independent agencies need. Other positions include:

Compensation for the other positions in the agency do vary by size of agency and location. But, we can tell you the median hourly wage for a Customer Service Representative is $14.51.

You would need to work toward some of these positions by gaining experience in the industry. But, the good news is, the independent agency system can afford you plenty of opportunities to move into different areas within an agency.