By Indeed Editorial Team
Insurance is something that provides financial protection and coverage in the event of an adverse event. Many people need insurance coverage, and they rely on their policies for various reasons, including for their medical needs and to protect their property and possessions. Selling insurance to clients is a potential career path that many people have an interest in pursuing.
In this article, we will discuss whether insurance sales is a good career and the pros and cons of this career path.
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What is insurance sales?
Insurance sales involves selling various types of insurance to customers, including home, life, health and auto insurance. People who sell insurance are often referred to as insurance agents or brokers. Many focus on individual policies and needs, although some offer insurance products to commercial clients. A commercial agent might sell liability and property damage policies, as well as executive and employee coverage. Insurance agents can also work with businesses to supply coverage to the employees.
Many insurance agents work for independent brokerage firms and agencies, selling the products of various insurance companies and providers. A smaller portion of agents is self-employed, while the rest work for individual insurance carriers to sell their products. Some agents earn a salary, but most work on commission. A commission-based sales position requires an agent to spend their time developing relationships and pursuing leads.
Pros of working in insurance sales
If you’re wondering whether insurance sales is a good career, it’s helpful to consider the pros of this professional opportunity as you make your decision. Here are a few you can think about:
One of the pros of selling insurance for a living is the growth potential. According to the U.S. Bureau of Labor Statistics, the job outlook for insurance sales agents is positive, with an estimated growth rate of 5% by 2030. This number amounts to 27,500 new jobs, marking a higher growth estimate than average for all occupations.
Many insurance agents set their work schedules, which provides flexibility. If you do not want to work the traditional business hours or you have other responsibilities that dictate your need for a more flexible work schedule, the idea of setting your schedule is probably quite appealing. Insurance agents may also work from home for at least part of the time, although they often meet with clients and potential leads in person. Those in-person meetings will typically take place in an office setting.
High earning potential
Since many insurance sales agents earn an income based on commission, the earning potential is substantial. Your potential for earning depends on your work ethic and willingness to put yourself out there to build relationships and sell insurance products to clients. Additionally, insurance agents can maintain a passive income stream from policy renewals.
Opportunity to provide a benefit
Insurance is something that everyone needs, and it can provide a cushion in the event of an adverse situation, such as the untimely death of an individual or a natural disaster causing significant property damage. By selling insurance to people, agents have the opportunity to provide a great benefit to their clients. Health insurance can provide a cushion for health expenses and medical treatments, while auto and home insurance protect these valuable and necessary possessions. Life insurance is also beneficial because it can provide funds to the family members of someone after they pass away.
Minimal entry barriers
Insurance salespeople must pass a state licensing exam, but there are few other barriers to entry. This role does not require a college degree, although some firms may prefer it. Prior experience isn’t a requirement, as most agents learn while on the job and through training.
Cons of working in insurance sales
Many benefits are available to those who pursue a career in insurance sales. However, some cons exist as well, which you can consider as you determine if this may be the right career path for you. They include:
Many insurance agents are independent contractors, which means they don’t qualify for base salaries. Even those who earn a base salary must supplement their income with commissions, which are paid based on sales and achieving certain quotas and goals. For some people, the thought of earning commissions is appealing. For others, it can cause stress and worry about their future financial situation.
New insurance agents often work long hours to build and strengthen relationships and get their names out in the industry. Even those who do qualify for a base salary may be held to a strict sales quota. Before you start a career in insurance sales, make sure you understand the compensation structure and what to expect.
Like many sales-focused career opportunities, selling insurance is a fast-paced career that requires focus and determination. Many potential leads and clients will say no or lose interest in the products you sell, and they may choose another agent’s offerings over what you can offer. As an insurance sales agent, you need certain skills to succeed, including perseverance, the ability to be told no and a positive attitude.
Limited paid time off
Since many insurance sales agents are independent contractors, they don’t always have full benefits. One of the cons of working in insurance sales is limited paid time off. This is especially the case if you own your own business. Taking time off takes time away from your ability to build relationships and look for leads, so it may be difficult to do so, especially when you’re starting your career.
Interact with all types of people
An insurance agent must interact with people from different places and backgrounds. Some people are friendly and easy to interact with, while others are more challenging, especially in a sales setting. You might encounter people who aren’t willing to acknowledge their mortality or the risks associated with human life. They may not have an interest in insurance coverage. Some of the people you interact with could treat you with disrespect or disdain. Strong people skills and an impervious nature are essential in this career.