How to Become a PC Insurance Agent

An insurance property and casualty agent doesn't receive the high income initially but eventually makes a considerable amount of money. Most companies pay between 7 and 10 percent of the premium the representative sells immediately and at each renewal date. Occasionally independent agents get a little more than that. You have to enjoy working with people, be able to maintain accurate records and be a student of the insurance business to be successful. If you're a social person who is organized, it's perfect. The job is hard work but very rewarding.

Things You'll Need

• Application
• Computer
• Training material
• Examination date and certificate to enter
• Fingerprint card
• Business suit (optional)
• Website (optional)

Instructions

1. Decide whether you'll be an independent representative or work as a captive agent. Independent representatives sell the products of many different companies. A captive agent is just that, only allowed to sell for one company. The difference between the two is often the starting salary and expenses. The captive agent doesn't have to pay for an office and gets a declining salary until his commissions grow. Today, a third option exists, that of an online representative.

2. Apply to get a license. You can get every state's paperwork for license application online. Each state has different requirements before you secure a license. The link at the bottom of the page outlines how to find what you need in your state. If you live in an area where you'll work across a state border, it's best to get a license for your state first and then secure a reciprocal license in the state where you work. If you sell online, you'll need a license for any state where your clients live.

3. Sign up to take training. To become a P&C insurance agent in any state, you need a license. Most states require that you take initial classroom or online hours before you take the examination. Even if you don't have to have classroom hours, you'll need study materials for the exam, which covers insurance law and property and casualty products.

4. Take your certificate of study with you to the exam. If you live in a state that requires preliminary classroom hours, you won't be able to take the test without the certificate. To pass the examination, you need a score of 70 percent or higher in most states.

5. See if you need to get a fingerprint card. Some states require that you send a fingerprint card before you receive a license. This allows them to do a background check on you. Take the card to a local police station and pay a few dollars. They fingerprint you and sign the card.

6. Select a company or look for a job within an established agency. It's normally best to start with an established agency or as a captive agent if you sell P&C insurance in person. Once you develop an understanding of the insurance community, you'll know the best avenue to take. If you start a website to sell insurance, you'll be busy for a while getting a reciprocal license in every state where you plan to sell insurance.

7. Aim for consistency and customer retention. Since you get money every time a customer pays a premium, the income compounds. If you sell four policies a week with an average six-month premium of $500 at 10 percent commission, you'd make $800 that month. However, if you do that consistently, when the policies renew, your income will double because of the new policies you sell and the old ones renewing. Imagine working for several years with thousands of dollars of policy money paying you commission, without having to sell new policies. You earn every penny initially, but once you've been in the business a while, it becomes very rewarding.

Resources

• NIPR