According to the Bureau of Labor Statistics (BLS), the insurance agent job market is expected to grow by 6% between 2021 and 2031. Are you thinking about joining this lucrative and rewarding job market?
Becoming an insurance agent can be a welcome job change, but it doesn’t happen overnight. You’ll need to take specific steps before you can begin accepting clients and helping them choose the proper coverage. Thankfully, you can complete this process without overhauling your existing routine!
Today, we’re sharing how to become an insurance agent from home. The process is simpler and more flexible than expected, making it even easier to begin!
Step 1: Understand Academic Requirements
If you see yourself working for an insurance agency in the future, it’s important to understand the level of education they expect their agents to have. Some will require a four-year degree while others are more lenient. Even if you don’t have a degree, they may be willing to bring you on board as long as you have the requisite training and experience.
If you do need your degree, this could be the first step you need to complete. Before you invest the time and money into going back to school, however, make to speak with the company in question to understand the specific guidelines and timelines.
Step 2: Obtain Your License
Before you can become an insurance agent, you’ll need to make sure you’re properly licensed and credentialed, first. The exact steps you’ll need to take will depend on where you live and what your local regulations require.
At the most basic level, you’ll need to hold an insurance license for the state in which you want to practice. In addition, some regions may also require you to obtain a general business license, especially if you plan on opening your own agency.
If you’re unsure where or how to begin, start by visiting the website for your local municipality. There should be resources on there to help aspiring business owners get all of their administrative paperwork in place to meet local guidelines.
Note that the license you pursue should be matched to the type of insurance you want to sell. There’s one exam for each type of insurance, such as life insurance. This can help you narrow your study sessions down quite a bit!
Selling Across States
Do you dream of working with clients from various parts of the country? If so, you will need to obtain your niche-specific insurance license for each state in which you want to practice. There is an exam fee associated with each test.
In addition to paying the fee, you’ll also need to review (and comply with) all of the unique licensing requirements for each state. It isn’t as simple as copying and pasting the same formula from one location to the next.
Understanding this, you might be tempted to keep your practice within your general vicinity. However, while the process can be a little complicated, it’s worth expanding into new territories if you know you have the bandwidth to do so.
Some of the reasons why we recommend selling across multiple geographic locations include:
- Expand the footprint of your insurance agency
- Gain access to a greater number of leads
- Grow your professional network and industry connections
Some states will be more lenient in their requirements than others. If you choose to work in the field while working toward your license, your employer may even be willing to help offset the costs as you take each exam.
Step 3: Pursue Professional Training
There are two key ways for aspiring insurance agents to learn the ropes. They include:
- Learn on the job
- Attend formal training
Years ago, attending formal training would mean giving up a week or so of your time to take an in-person seminar. You’d be responsible for finding transportation, arranging lodging, and showing up for each session ready to learn.
Today, more students than ever before are taking advantage of the rise of e-learning! In fact, one study shows that 72% of U.S. business leaders believe they have an edge over the competition because they leverage digital learning tools at work. These are programs that allow learners to attend a course from anywhere, at any time.
When you have control over your own training journey, it’s easier to fit it into your daily schedule. For example, if you work full-time, it may not be feasible for you to devote entire days to each module. Instead, you need the ability to watch a lesson, take notes, ad reflect on your own time.
This is where a platform like our Insurance Advisor Elite Insurance Sales Training Program comes in. When you sign up for access, you’ll receive a bevy of solutions designed to help you jumpstart your career in insurance. These include:
- Current training programs
- Future training programs
- Online resources and digital tools
- Tips, strategies, and coaching to help you grow your business
Whether you’ve brand-new to this industry or you’ve worked in the insurance space for years, our insurance agent training program will help you learn about the different aspects of this space, with insights that can boost your sales and revenue. You can learn more about it (and the other programs we offer) right on our homepage!
Step 4: Choose Your Business Model
If you choose to work for an already-established agency after you get your insurance license, then you can skip to the next steps below. This step concerns individuals who want to establish their own insurance agency.
If this sounds like an interesting career path, consider which business model you’d like to pursue. The three options include:
- Sole proprietor
This guide breaks down the differences between these various models. Insurance agents may choose to work for themselves, join together with a few colleagues to form a partnership, or create a corporation that operates as its own legal entity. Let’s take a quick look at the steps you’ll need to follow when setting each one up.
If you plan to create a sole proprietorship, you will likely need to apply for a business license. The good news is that most municipalities allow you to take care of this step completely online!
To get started, you will need to register the name of your insurance business (or your name) on the applicable state government website. When this is complete, you’ll receive a tax ID number for your sole proprietorship.
Keep in mind that while this is a general requirement, it does not apply to every state. For instance, California does not require state residents to register as sole proprietors if that individual plans to operate their business under their personal name.
Before you open a sole proprietorship, it’s essential to realize the risks and liabilities that you’ll shoulder. If your agency goes out of business for any reason, your personal assets will be on the line. As you’ll learn in Step 6, this is why it’s so important to get insured as soon as possible!
Partnership or Corporation
To create a partnership or corporation, you’ll first need to apply for a Federal Employer Identification Number, or Federal Tax ID. You’ll reference this number when paying taxes once you’ve set up your insurance business.
You can reference each state’s guidelines to learn more about the different forms and processes you’ll need to complete to finish setting up your business model. These will vary depending on the exact type of company you plan to establish. For corporations, your options include:
- Limited Liability Corporation (LLC)
These may sound similar, but each has its own guideline and legal implications. Research the differences between these various insurance agent careers before diving into one.
Step 5: Understand Funding Requirements
If you plan to become an insurance agent, it’s critical to know the type of investment that lies ahead. Specific business expenses will vary from one entity to the next, so take the time to think about the start-up capital you need.
Some agents only need a few thousand dollars to get their business up and running, while others need much more. Often, this depends on a few different factors, including:
- Your geographic location
- The type of insurance you plan to sell (e.g. life insurance, final expense insurance, annuity insurance, etc.)
- Where you choose to establish your business (e.g. online or in a brick-and-mortar office)
Creating a balanced business budget is key to keeping your income and expenses in check, and building your long-term revenue. If you’re unsure how to set one up, these six steps can help you get started.
Step 6: Invest in Insurance
Depending on the business model you select, you may also need to insure your new insurance business. On a basic level, this means investing in a Business Owner Policy, or BOP. Once you have that in place, most states will allow you to pursue other forms of coverage, such as:
- Error and Omissions (E&O)
- Professional liability insurance
- Worker’s compensation insurance
Especially if you’re trying to cut costs, you might wonder if these supplemental policies are necessary. However, they could be more helpful than you think. For example, if your miss a critical piece of information or make a mistake, your E&O policy will protect you and your business.
Step 7: Creating Your Home Office
Many insurance agents choose to work from home either part-time or full-time. If you’re planning to open your own agency, the flexibility of remote work can be appealing.
If you go this route, you’ll need a properly-equipped home office. This should be a designated space where you can set up a computer, access your files, and communicate with clients on a regular basis. If you plan to see clients in person (versus virtual consultations), then make sure your home is located close to where a majority of them live or work.
If it isn’t, then you may need to purchase or rent a separate office. Location matters, and prospective clients will consider proximity and convenience when choosing where to visit for their insurance needs.
Step 8: Finding Clients
Once you’re properly licensed, trained, and set up to receive clients, you may wonder why there’s no one entering your office door. That’s because you have to go out and find your clients first!
As you set everything up from home, there are a few different ways to reach out to others and learn about their insurance needs. these include online and offline channels, such as:
- Social media posts
- Blogs and videos
- Word-of-mouth referrals
- Industry associations
- Cold calls
- Conferences and trade shows
You’ll soon discover that the insurance agency is built on networking. The more people you know, the wider your circle and sphere of influence will become. When you enroll in a course like our Comprehensive Medicare Sales Training Program and System, you’ll gain access to exclusive courses designed to optimize your prospecting efforts.
As you grow your connections and gain more clients, you may also need a customer relationship management (CRM) system to help you organize all of your accounts. This can help automate some of your sales efforts and help you provide a more customized approach to client support.
Step 9: Getting the Word Out
Finally, it’s time to get the word out about your new insurance agency! There are plenty of ways to advertise from home, from leveraging social media to setting up your Google Business profile.
The goal is to expand your online presence and local recognition. Once you have a few proven strategies in mind, go ahead and put them in place to grow your sales and jumpstart your business growth.
You Know How to Become an Insurance Agent From Home
With the right resources, you might find that it’s easier than ever to transition into an insurance sales career. The key is having everything you need just a few clicks away.
At Insurance Sales 101, we’re here to take the guesswork and the legwork out of training for your new role. From general training to sessions built around one specific type of insurance, we provide it all.
Now that you know how to become an insurance agent from home, are you ready to get started? Create an account with us today to learn more and let’s take this next step together!