How to Become a Life Insurance Agent: What You Need to Know

Written by Matthew King, time it takes to read this article is  minute(s).

 

With an average pay of around $62k each year, becoming a life insurance agent is a lucrative career for many people wanting a leg up. It is not always easy to become an insurance agent, though, and making sure you hit the ground running is very important. With that in mind, what should be your first steps?

Below, we will help you understand how to become a life insurance agent. This article will show you what you need before you even start looking as well as what resources are available to help grow your sales skills. So, read on and improve your opportunities for personal and financial growth.

Assess Your Qualifications

One of the first steps you need to take, before you get too down the rabbit hole, would be to look at your qualifications.

Most life insurance agents will need a high school diploma, GED, or some form of equivalent to be able to earn a license to offer insurance. Because of this, most insurance companies will demand this of you, meaning you might have a roadblock before you even start your journey.

In some cases, a company might ask for more of you, such as a bachelor’s degree related to marketing, before you can become an insurance agent. This is not mandatory for life insurance agents and will be due to an internal decision in that company.

It is important that you also understand that even if you meet these qualifications, sales methods are always changing. With how regulations, technology, and trends alter over time, you will need to be always educating yourself on how to be a better agent.

As such, you can always stay ahead of the game and make sure you can appeal to even the most demanding agencies by ensuring you have up-to-date training.

Get the Right Licences

You cannot start selling licenses without achieving a level of certification first. State and federal laws demand that you pass a test to ensure you understand the regulations associated with being an insurance agent. Some states may even demand you undergo a background check or even fingerprinting before you can start selling.

In many locations, you might even need to run through a specific training regime. While these will rarely offer marketing skills, they will instead ensure that you perform your due diligence as an agent.

Do the research related to the state you not only live in but those you plan to sell to. Each of these may be different, and you must avoid offering insurance illegally are each very important. One of the first places you might want to look is the National Insurance Producer Registry (NIPR), which can separate license rules and fees by state.

Research Specialized Insurance Areas

There are several different areas of life insurance you might want to investigate. Knowing the differences between them allows you to sell each one on its own or in combination with others. They each have their own benefits to the person taking out the policy that it would be good for you to know about.

By learning more about them, you can ensure your level of knowledge remains high. You can also ensure you have all the answers when customers ask you questions related to their intricacies.

Medicare

This is the federal health insurance program for the elderly, disabled, and specific health conditions. It covers many different areas, including:

1. Hospital insurance. This would cover costs related to receiving direct care. These might mean a patient’s inpatient fees, care in a nursing home, or home and hospice care.

2. Medical insurance. This relates to costs that occur when a patient is not receiving treatment for an existing illness. For example, if they receive outpatient care, medical supplies, or preventative treatments.

3. Prescription drug coverage. This can help the owner pay for prescription drugs, vaccines, or shots.

Medicare may either come from the government, in which case it is “Original Medicare” (OM), or from a private company as “Medicare Advantage” (MA). These have different benefits, for example, MA offers insurance for vision, hearing, and dental care. They also have different fees, with OM receiving payments from the government, which are usually things people will ask you about.

Final Expense Insurance

This can help the owner to pay for burial or funeral expenses. Usually, you can discuss this with a potential buyer in the context of not wanting their family to end up with such a burden.

Coverage costs tend to be much lower, as they will only cover a single event. They can also help settle debts or pay for the college tuition of dependents. It depends on the specific insurance policy and what it offers.

Annuity Contracts

Annuity contracts are different from any form of life insurance based on how it pays out. Instead of offering all the money up-front in one go at the end of life, it distributes the policy’s benefit over a longer period to the person receiving it.

These are great as a part of a retirement plan, where someone wants to have money that trickles in when they retire but also passes on to others if they die. If the person dies before they receive any payments at all, the beneficiary receives them all.

One of the major benefits of such policies is how they handle taxes. They continue to gain interest while not paid out, meaning that it helps you or your loved ones later on too.

Develop Your Insurance Agent Skills

Success at being an insurance agent means being up-to-date with many interpersonal skills that can be hard to train on one’s own. You might want to investigate a training program or similar to keep these abilities at a high level, or if you feel you need a boost to your existing skills.

Some of the skills you might want to improve and maintain might include:

1. Communication. Interpersonal skills are a very important part of any sales work. You should have the ability to read someone’s tone and body language and then react in kind, increasing empathy and understanding.

2. TrustBuilding trust between yourself and any potential buyer is imperative. By helping them understand how you are trustworthy, you can relieve them of any concerns they might have about life insurance.

As life insurance links to the concept of death, building up the above skills is a cornerstone of getting past this starting point. You can then move on to areas of conversation people might want to know about, such as the details of any policy.

3. Sales and marketing. Of course, you will be taking on a role of a salesman, which means you need to understand what works and what doesn’t in the world of marketing. Knowing how people respond to different communication methods and the best ways to draw in others can ensure high sales.

4. Time management. Having a good work ethic means you can get the job done and not see yourself distracted, even when working from home. So, learning about some of the best methods for this such as Kanban, Pomodoro, and so on, can do wonders for even the most unfocused person.

Look Into Training Programs

You cannot expect to learn all these yourself without a little help. Good books will only go so far, as will the licensing process.

Instead, investigate insurance agent courses that focus on life insurance sales training. They are often up-to-date on sales trends and the latest sales technology too, so even if you have previously received training, it may be useful to you.

Understand Insurance Regulations

State regulators protect consumers from problems related to unethical life insurance sales. Some of these regulations may interfere with unproblematic processes to protect vulnerable people. As such, even if you are remaining above board, to avoid fines it is important to know what they are.

Most of these regulations relate to three key areas:

1. Licensing. You need to have a license to sell insurance. This is covered further up.

2. Insurance product regulations. As different companies sell life insurance, they might adjust these policies and the prices they charge for them. While not usually facing oversight, sometimes the NAIC may try to ensure the charges buyers face are fair.

3. Financial regulations. All insurance companies are expected to submit their financial data to the NAIC. While this may not be important if you work for a larger firm, if you decide to form your own company you will need to do this too.

Investigate Insurance Technology

There are several technologies that can relate to either life insurance or sales in general that can help you with being a sales agent. Being at the top of your game in your understanding of these can put you ahead of the pack when it comes to finding a job in a larger company.

Tracking insurance claims and talking with clients, for example, will often occur through some form of online system. This might be a customer relationship management (CRM) system or work-tracking software. Either way, knowing about these and how to use them can speed up your workflow from the get-go.

It may also benefit you to understand the upcoming trends in the world of insurance so you can be ready for any changes that might occur. For example, it is useful to know that automated claims are becoming more prevalent, with AI processing many digital claims these days. Instead of ignoring this trend, many companies are training their insurance agents to see when AI makes mistakes and how to handle that.

Machine learning and AI are also at the forefront of fraud detection. By having a large database of fraudulent claims, they can look for patterns that a human might take much longer to find. They can then flag these, allowing an insurance agent to take action and deny a claim or raise it up the line to a fraud department.

Seek Out Networking Opportunities

If you want to succeed as an insurance agent, it is important you know the most important faces. Try to seek out networking events and attend them. You should not even talk about insurance most of the time, but instead, try to make friendly contacts you can rely on moving forward.

If you are without work, use these opportunities to learn as much as you can about the people and culture in the insurance world. This will help you when it comes to intra-office culture and interviews.

Finding Employment

The first thing you will need to do is put together a resume that covers your skills and how well you would work as a sales agent. Make sure to cover the training you have had, whether it be related directly to insurance or more soft skills. This can often put you over the edge compared to others.

After this, it is a case of applying, creating custom cover letters, and finding a company with a good reputation for hiring.

In the interview, remember to negotiate when it comes to the insurance agent salary you deserve. Use all the above information to prove what you should earn and have the confidence to make a better deal. After all, you are only proving how good a salesperson you are by selling yourself.

Starting Your Own Agency

Your career as an insurance agent does not need to always start with an existing company. You could break out and make something of your own.

Make sure to put a comprehensive business plan together, though. This will ensure that you can discuss your potential with insurance companies whose products you wish to sell.

Learn How to Become a Life Insurance Agent

Now you understand how to become a life insurance agent, you can start your journey to a better career. Though, many of the above pieces of advice will demand a lot from you. We can help you out with these so you do not burn yourself out.

We run training programs dedicated to helping people who might need a helping hand to get started in the world of insurance. With our valuable insights, you can ensure you have the best opportunity to grow your career over the next five years and longer. So, check out our courses today to learn more.

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