How to get an insurance license? Here are 5 easy steps

According to the U.S. Bureau of Labor Statistics, the median annual wage for insurance sales agents was $50,940 in May 2019.  Thus, insurance careers can be a well-paying and exciting path to choose. If you want to know how to become an independent insurance agent but don’t know where to start, an insurance license is the first step.

If you don’t know how to acquire an insurance license, then you have come to the right place.

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Step One: Acquire a high school diploma and/or a college degree

To acquire an insurance license, you certainly don’t need a college degree. Although a high school diploma is the only educational requirement for an insurance agent, it would be a huge asset to get higher education relating to insurance.

An insurance agent must understand what motivates people to purchase. Recently, a few colleges like Bauer College of Business and Ferris State University, have started offering courses in insurance and sales marketing.

Having people skills will take you considerably far in this career, but a good knowledge of the business world will give you an edge against competing independent insurance brokerage.

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types of insurance licenses

Step Two: Decide what kind of insurance license you want to obtain

Now that you have the basic requirements down, it’s time to learn about different lines of insurance. Here are some of the common types: 

  • Life Insurance
  • Health Insurance
  • Property and Casualty Insurance

The type of insurance you want to sell determines what insurance licensing exam you take. For example, if you want to sell health insurance, depending on your state, you would sit for a health licensing exam to gain a license to sell health insurance.  

Generally, insurance agents take multiple licensing exams so they can sell one or more of the lines of authority (types of insurance that an agent is licensed to carry out). Since your job is selling insurance, it’s always better to choose as many lines of authority as possible. So, if you wish to add a line of authority in your existing license, you must apply online through the National Insurance Producer Registry (NIPR). 

Become a part of an ever-growing insurance directory.

Get your profile listed and increase your book of business. 

Step Three: Research about insurance license requirements in your state

Requirements vary for acquiring an insurance license depending on which state you want to sell policies in. Did you know that you can live in one state and sell policies in another? Educate yourself about the various licensing requirements provided by the department of insurance in the state you wish to sell policies in to find out what you need to do to take the licensing examination. Furthermore, check out the National Association of Insurance Commissioners (NAIC) website for more information.

The majority of states require you to complete a pre-licensing insurance course before registering for state licensing exams. Enroll in a state-approved coursework program before your license examination. For example, the California Department of Insurance approves the Property Casualty/Broker-Agent Course program from MGT Insurance School. Moreover, a program like that can help aspiring agents understand property-casualty insurance better.

how to become an insurance agent from home

Step Four: Take your insurance license examination

There are different fees and requirements for the state licensing exams in every state. Sign up for the licensing exam in the state of your preference. Prepare for your exams by using the study materials available on your state’s department of insurance website. You will be tested based on your knowledge of insurance basics, rules, and regulations. 

Step Five: Submit your documents for a background check

All states require their applicants to submit documents for a background check relating to your work history and criminal record. These documents include a state exam certificate, fingerprint card, a citizen affidavit, and a background report. The state insurance board will review, approve, and issue your  license.

Congratulations, you are now a licensed insurance agent. You have two choices as a brand-new insurance agent — become either a captive agent or an independent agent. A captive agent is bound to one insurance carrier and typically receives servicing and marketing support. An independent agent can work with several carriers, although traditionally, they have to do much of the servicing and marketing work on their own. Ultimately, the kind of insurance agency you want to run depends on you.

However, nowadays, insurance agencies such as Covered by SAGE are providing independent agents servicing and marketing support, and they still get to sell products from multiple carriers.

Whichever path you choose, remember to protect your agency with suitable insurance. Take the initiative to generate leads, promote your business, look for prospects, and maintain your clients. We sure hope you have a great career ahead.

Has this article been helpful to you? Leave a comment below and share your thoughts with us.

Become a part of an ever-growing insurance directory.

Get your profile listed and increase your book of business. 

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