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Choosing a Career in Insurance

 

Insurance has been around since the ancient Romans began selling "insurance" to local shop owners. Of course, this type of insurance was more akin to "Mob" payoffs than any true form of business or liability insurance, but the basic premise remained through the following millennia: "Pay me and I'll take care of you."

Virtually anything can be insured for the right price. Movie stars have been insuring legs and breasts and hair color since "talkies" came out. Surgeons insure their hands, homeowners insure their property, stores insure their inventory, pet lovers insure their animals, and individuals carry life insurance policies for when the inevitable occurs.

Some form – or multiple forms – of insurance touch each and every one of us on a daily basis whether we know it or not. Each time we drive we hope we don't need to put in a claim for accident insurance. We take vitamins and eat good diets to prevent doctor visits that might not be covered by health insurance. Locking doors and windows at bedtime each night helps us from getting robbed, thereby putting in a claim with our home owners insurance.

Insurance is all around us. It's virtually recession proof. Some forms of insurance are mandated by law, others are mandated by common sense. Either way - the insurance business can easily become a lucrative long term career commitment.

Insurance Career Opportunities

Most people who choose a career in insurance are interested in an insurance sales position. This is where the money is. Sales reps, agents, brokers – whatever – make commissions that far surpass other industries in terms of time spent to get the sale, and amount of the sale, vs. dollars earned. For instance, if your husband sells cars and you sell car insurance, guess who will make more money on the sale of a car? Unless he is selling high end luxury vehicles, you'll probably make more money than your husband by selling the new owner his car insurance policy!

Sales agents also make residual commissions with policy renewals. Since policies are renewed automatically, this doesn't entail any further effort for the agent of record (the sales person who sold the original policy). A good agent, however, will always contact the policy holder to review the policy and suggest additional services which obviously equate into an additional commission.

If the insurance industry intrigues you but you don't see yourself as a sales person, there are some other options to consider.

• In the car insurance business you could become: an adjuster, a car rental specialist (they work hand in hand), a certified body shop owner who is approved by big insurance companies.

• For health or medical insurance: a billing and coding specialist, a customer service rep.

• Life, Business insurance: large offices always have administrative and support help.

Insurance Career Information

If you like people, have any experience selling, like flexibility, and want to work towards a real career as opposed to a job, becoming an insurance agent is a great choice. Don't kid yourself, though. Insurance is a sales career. Many companies who actively recruit new agents like to say, "You don't need to sell anything. You just need to provide a service that people already know they need."

Car washing is providing a service people know they need. Insurance is pure sales. No matter what euphemism someone wants to give it, you need to sell yourself, your company, and the products. If you aren't comfortable making cold calls, following up on leads, working all hours of the day and night to meet with clients at their convenience, and spending more than half your time on the phone or using email – sales in any form is not for you.

When you become an agent you usually have two basic choices for how you want to represent companies. You can become an "independent agent" meaning you work for yourself but represent different companies and frequently even different types of insurance. Many independent agents go on to getting their broker licenses and opening their own insurance agencies.

Your other – and actually more common – choice is to affiliate yourself with one particular company. By going this route you have a few benefits: most probably a base salary (plus commission), some paid training, a mentor, career growth (district manager, etc.), and maybe even free or deeply discounted policies for you and your family.

Insurance Agent Salary

Salaries vary greatly. Since commission is a large part of your income the more you sell, the bigger your checks. If you work for a company where you are getting a base salary as well, you can expect an average of $20,000 a year to start.

Base salaries don't tend to increase much over your tenure. The commission splits grow, however, A first year insurance agent might have a base salary of $20,000 plus a 20% commission. Ten years later he might have a base salary of $27,000 plus a 45% commission.

If you have opted to be an independent agent you are strictly on commission. At this point your income is totally dependent upon your efforts and success. Independent agents, however, are rewarded with higher commissions even to start simply because they get no benefits, no salary, etc. Depending on what type of insurance you are selling, you can expect your commission level to be anywhere from 30% to 70% immediately.

A good agent, in any insurance sector, should expect to make at least $40,000 - 80,000 a year in his first few years as an average if he understands how to use his talents, target his niche audience, and can hone outstanding customer service and people skills.

Insurance Career Education

Insurance is one of those businesses that demands little in the way of formal education. There are no college degrees or certificate programs. Your entire education is based on studying for the tests you will need to take in order to get licensed. No matter what kind of insurance you want to sell, you need to have a license.

However, some licensing requirements are more stringent than others, and they vary greatly state to state. For instance, to get a license to sell life insurance, the requirements range from a low of a 16 hour study course to over 40 hours.

Some states require a thorough background check, fingerprints and a high school diploma in order to be considered for a licensing class.

The course can cost anywhere between $50 - $250 depending on the state and the type of course. Taking a course on line is much less expensive, but you will miss the opportunity to have valuable discussions with the instructors and even classmates.

Some large companies actually will pay for your course and your test. Companies like State Farm actively recruit new agents who have not been licensed as yet.

Once you finish the course you then need to schedule a time and place to take your test. Some states give you choices as to locations; others just send you a notice telling you where and when to appear.

The test costs another $50 or so to take. In many instances you will be alerted immediately as to whether you passed or failed. If you pass you will have your photo taken there, and you will receive your license.

After all that, you will be required to keep up to date in your chosen industry and every year or two you will get a notice explaining what type of continuing education you must complete in order to renew your license. Nowadays most of this can be done online at your convenience and amounts to about four hours of studying and a test.

Insurance Career Skills

If you don't like dealing with people almost constantly, find another profession. To be successful in any insurance field you not only need to deal with people effectively, you need to love it. Whether you have good days, bad days, horrendous clients, stupid questions, lost policies, language barriers, or too many people who wasted too much of your time – you need to get up the next day and start again. If you see this as a problem, it will be.

To be successful you will need to have good people skills at the very least. Clients are more likely to buy from someone "nice" instead of buying from someone who knows every single bit of information about the policy, company and industry, yet comes off as irritating or worse. Nice and friendly will win out over righteous and rude every time!

Next, you need some sales skills. Sales people are born sales people. At least the very successful ones are. Sales is not something you can learn any more than you can learn to be a great artist. You either have the talent, or you don't.

Can you sell? If you have ever talked your wife into going camping against her will, yes, you can sell! If you have ever talked your husband into giving up his two seater sports car for a family mini-van, you can sell!

Aside from people and sales skills, you need

  • To be organized. Forgetting an appointment or neglecting to return calls will be a death sentence to your future.

  • Dedication and perseverance. Six figure incomes don't go to people with 30 hour work weeks.

  • Technology skills. The more techy you are, the better. PCs, Blackberries, email, text messaging…it all helps.

  • Flexibility. If you need to be home by 5:00 PM every day, this could be a problem.

  • A professional presence. People aren't going to believe in your knowledge or success if you dress like a bum and drive an old beat up car. "Talk the talk, and walk the walk."

  • To learn something new every day. Keep up with the industry, your company, and your locality. They tie in together.

Why Choose a Career in Insurance/Final Thoughts

Insurance is the ideal choice for anyone who doesn't want to be strapped to a desk all day long. Agents rarely are at a desk. They are usually on the road meeting clients and doing business. Whether you work for a company or you work for yourself, this field provides plenty of flexibility and almost unlimited income potential. Just make certain you don't mistake "flexibility" for needless procrastination and inactivity.

In addition to the flexibility it is one of the very few "white collar" professions which requires no long term expensive formal education, while still offering a very lucrative career path.

And unlike other professions, it not only provides but encourages lateral expansion into other areas of the insurance sector. Many licensed professionals obtain additional licenses as time goes on in order to maximize their earning potential while diversifying their streams of income. Cross-selling and up-selling have become the name of the game and if you only have one line of insurance to sell to a client, you're losing money. The insurance business easily lends itself to this type of growth and expansion with minimal financial outlay and exponential returns.

It is also an ideal career to get involved in at any point in your life since it requires minimum time and financial investments. Many people turn to insurance later in life when their previous jobs disappear or their life demands some freedom and flexibility. Instead of spending four years in night school earning a degree, you can change careers and be up and running in a few months or less.

Not quite ready to make a full time commitment? Try it out part time! Many newcomers to the profession start out on a part time basis for a variety of reasons. Some need to supplement a full time income which doesn't cover all the bills, and others have reasons that prevent them from working 40 or more hours a week.

And finally, if you have what it takes, clients become life long friends. It's a wonderful way to meet new people. Because after all, insurance is all about people.

Thank you to Marie Duffoo for this "Insurance Career" article.
 
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