Choosing a career in life insurance opens doors to job security, attractive earnings, schedule flexibility, and the potential to work independently or as an employee. Nevertheless, the field comes with its challenges, including potential long hours and routine tasks. The question remains: is a career in life insurance the right fit for you? In this comprehensive guide, we explore the landscape, earnings, career paths, and the pros and cons associated with this profession.
Unveiling Earnings in Insurance Sales
Examining the earnings of insurance agents reveals a median annual income of just below $50,000 as of May 2021, according to data from the Bureau of Labor Statistics (BLS). This translates to an average hourly wage of around $24. However, the range is broad, with the lowest 10% earning $29,970 and the highest 10% exceeding $126,000. National independent life insurance agent Lisamarie Monaco emphasizes that typical pay for independent agents varies based on the insurance carrier and includes an advancement after the client’s first premium payment.
Kelly Maxwell, CEO of Seniors Mutual, adds that new agents earning commissions can receive approximately 110% of the annual premium. However, the life insurance sector’s remuneration landscape varies by region, and commission-based agents must factor in lead acquisition costs.
Diverse Career Paths in Life Insurance
A career in life insurance offers diverse paths with roles such as life insurance agent, underwriter, case manager, claims processor, and customer service representative. Professionals can work for established life insurance agencies or operate as independent agents and entrepreneurs. Maxwell notes that most roles in life insurance are commission-based and independent, where agents purchase leads and earn commissions on sales. Salaried License-Only Agent (LOA) positions, where all commissions go to the company, are becoming less common but can be suitable for entry-level employees.
Entering the Industry: Entry-Level Jobs
Entry-level opportunities abound in life insurance, spanning roles like life insurance agent, underwriter, case manager, claims processor, customer service, or marketing. For new agents, a salaried LOA position with a company can provide valuable learning experiences. Monaco suggests starting from the backend for industry newcomers, emphasizing the importance of seeking like-minded individuals and mentors if aspiring to become an independent agent and entrepreneur.
Life Insurance Job Outlook
While the BLS predicts a 6% increase in employment for insurance sales agents from 2021 to 2031, the Insurance Information Institute highlights that 106 million adults lack sufficient life insurance coverage. This gap presents an opportunity for independent agents, who control 50% of the life insurance market, to make a meaningful impact.
Weighing Pros and Cons
Pros of Life Insurance Careers
Job Security: The essential nature of life insurance ensures a continuous demand, providing job security in the industry.
Potential for High Pay: Successful agents, especially in sales, can enjoy lucrative earnings, potentially reaching six figures.
Flexibility: Insurance agents often enjoy flexibility in their schedules, allowing for better work-life balance.
Growth Potential: Alongside a substantial salary, agents can grow agencies easily in the insurance industry.
Cons of Life Insurance Careers
Monotony: The work can be perceived as repetitive, hindering career advancement.
Long Hours: Working evenings and weekends is common, impacting work-life balance.
Income Instability: Earnings are commission-dependent, leading to financial instability and uncertainty.
Lead Challenges: Finding quality leads, particularly in the early stages, can be daunting and may contribute to career challenges.
Conclusion
Choosing a career in life insurance involves careful consideration of personal preferences, goals, and the ability to navigate the challenges inherent in the field. While the potential for job security, high earnings, and flexibility exists, individuals must weigh the cons, such as routine tasks, long hours, financial unpredictability, and lead acquisition difficulties. Ultimately, success in a life insurance career requires a combination of resilience, strategic planning, and a genuine passion for helping individuals secure their financial future.