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How Insurance Agents Are Paid – The hardest part of the job for a life insurance agent is finding good prospects. No matter if you know life insurance inside and out and can explain the nuances of your product with impeccable clarity, you cannot survive without a lead. Knowing how to find and use leads is more important now than ever because sales are increasingly moving online, so agents are competing with computers to sell.
The life insurance market unfortunately has hundreds and hundreds of agents competing for the attention of precious few qualified prospects. Getting in front of these prospects before your competition is vital if you want a profitable, long-term career in this business. Note that training in industry, which pays an average of $52,180 per year, is only called “moderate.”
How Insurance Agents Are Paid
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The following methods provide the best ideas for finding life insurance quotes. Below is an explanation of each method along with its pros and cons.
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Perhaps the easiest way to ensure a steady flow of leads as an agent is to work for a company that supplies their reps with leads. Many life insurance agencies use the promise of referrals to motivate potential agents during the recruitment process. While the idea of not being able to do business in itself is attractive, the image companies paint about their flagship programs is almost always more attractive than the reality.
However, the fact that company leaders have no upfront costs does not mean they are free. When you receive leads from your employer, the company almost always takes a cut of your commission in return.
If you’re just starting out and you have marketable skills, this might be a good deal because paying for leads might burn through your money before you get any significant commissions. However, for good sellers, the company’s leads cost more in forfeited commissions than what they pay upfront for third-party leads.
The company’s CEO also has a reputation for working himself to old age and death. The turnover rate at most life insurance agencies is astronomical: the average new agent lasts less than 90 days. When an agent quits, the company retrieves its leads and often distributes them to another group of new agents. By the time you get your hands on the head of the company, it may have already been said by half a dozen or more former agents.
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If your company doesn’t provide leads, or if it does but you’re not happy with the quality, there are third-party companies whose sole business is directing life insurance agents. The way it usually works is you give the company your zip code, how far you’re willing to travel to meet with prospects, and how many leads you want to order. You pay upfront, and the company gives you a pool of leads within your defined geographic boundaries.
The biggest advantage of buying third party leads is the lead provider, unlike an employer who provides the leads, does not take a large portion of your commissions in return. For a salesperson with a high closing rate, the lead’s cost becomes a small fraction of the commission he receives.
Another benefit offered by many lead generation companies is the ability to specify lead characteristics such as age, income, and desired profit margin.
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Some companies offer a choice between exclusive leads, meaning they are sold only to you, and non-exclusive leads, meaning they are also sold to other agents. Unique leads are more expensive, but you have less competition for their business.
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The main drawback of third party leads is the risk you will experience. You pay for them in advance, which means if you don’t sell any of them, you effectively have a negative paycheck for the week. New agents who have not yet perfected their sales skills are especially susceptible to this risk.
To get new clients from LinkedIn, you must know how to use the site to its full potential.
You want your profile to appear. When a person is reading, he should feel like he knows you as a person and as a professional, even if he has never met you. First, upload a photo that portrays you as a professional. That means no beach photos, no photos with friends and definitely no selfies. While you don’t need a glamor shot or a high-dollar photographer, you should pay a small fee to get a professional headshot from a reputable studio.
Then, take the time to write a thoughtful summary. Your summary section should provide a rich description of your professional background. This is where you tell the audience who you are, why you got into life insurance sales and what you have done in the field. Without a thoughtful summary, most visitors won’t keep scrolling to read the details of your job history.
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When talking about job history, don’t simply list job titles and dates of employment. This section should read like a resume, with bullet points highlighting your accomplishments in each position, but make your writing more relaxed and conversational. This doesn’t mean talking about text, but you want your audience to feel like they’re having a conversation with you over coffee, not reading a boring list of your professional accomplishments.
The site’s group search function allows you to find groups related to your industry, your college and even your hobbies. Simply joining these groups is not meant to build your network or lead you.
By participating in the discussion and providing thoughtful feedback, you gain the trust of others in the group and establish yourself as an industry expert. When you are considered an expert, professionals in relevant fields feel confident to be referred to your business; Having someone like you in their network makes them look good by extension.
LinkedIn forums provide a place where you can offer industry advice to those who seek it. Use this function, but don’t come across as a salesperson. As you answer more questions and help with more knowledge, you can expect people to contact you for help based on the skills you’ve demonstrated.
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If the only time you contact people on your list is when specifically asking for leads or referrals, you’re doing LinkedIn wrong. Reach out to those on your list when they need help with something, or simply to say hello, wish them a happy birthday or congratulate them on a recent development.
When these contacts have life insurance business to refer to, they are more likely to send it to an agent who enjoys a highly active and meaningful relationship.
Sometimes a small social media post can provide an important clue that a person needs your services as a life insurance agent. Take the ever-present sonogram image for example. A new arrival marks a huge increase in a person’s financial burden over the next 18 years. This is the perfect time to reach out to that contact, again in a non-stressful voice, to congratulate him on the great news and let him know that you are available for whatever he needs.
Networking with other professionals provides a great way to get life insurance leads without cold calling, relying on overworked company leads or spending your own money.
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Many cities have networking groups where professionals from different industries meet weekly or monthly for socializing, business marketing strategies and business referrals to each other.
These groups are often diverse. Your network group might be a personal injury attorney, a tax accountant, a chiropractor, a personal trainer, a plumber, a physical therapist, and you, a life insurance agent.
Suppose a personal trainer in your networking group is guiding a client through a set of bicep curls when the client makes a vague comment about a recent medical scare and then says that his kids won’t be able to go to college.
A tax accountant may help a client with retirement budgeting when the client suddenly notices that his or her savings are insufficient for a proper burial. If the networking group is functioning as it should, these two professionals have your business card in hand and are using the opportunity to offer your services to their clients who clearly need them.
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In return, when one of your customers comments about needing a plumber or wanting to get in shape, you return the favor by recommending a member of the group.
On the plus side, company leads are usually free so if you’re just starting out you don’t risk your money on leads that may not turn into sales. Not having to compare lead providers and lead costs frees up a lot of your time to sell life insurance.
Conversely, they may be old and working themselves to death. When an agent leaves, the company retrieves its leads and may distribute them to new agents. By the time you get your hands on the head of the company, it may have already been said by half a dozen or more former agents.
Use a good professional profile picture. Read your employment history like a resume, showing bullet points of accomplishments and not just a list of previous employers. Write a good summary
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