I just now passed my property and casualty exam. I was wandering how do insurance agents get paid?

Question

I would rather know first hand how they get paid, and also what would be the percent some companies pay. How does getting paid work in the insurance agencie such as property and causalty

Answer 1

As you probably know insurance agency compensation is based on commission, a percentage of the policy premium. That percentage can vary significantly depending on the type of insurance of insurance you are selling. In a property and casualty insurance agency the commission can be between 7.5% and 20% depending whether it is home, auto or commercial coverage. Some companies may reduce the renewal commission somewhat. The total commission you bring into the agency is going to ultimately determine your compensation.

How an individual agent in an agency gets compensated varies from agency to agency. Every agency has it's own plan. Perhaps you could get as much as 50% of the new business commission with a significantly reduced percent of commission on renewal premiums. Some agents might have minimum premiums where you are not compensated at all unless the commission earned is above the minimum. Some agents have bonus plans for meeting production targets. Some agents have plans where you participate in the ownership of your book of business.

So what it means is you have to evaluate the total package i.e. salary (if any), new and renewal commission % paid, performance bonus, mix of business, paid employee benefits, companies the agency represents, potential ownership opportunities.

Best wishes and good luck.

Answer 2

It really depends on who you work for.  some pay straight salary, other pay straight commission and some pay both.