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A Day in the Life of a Insurance Agent/Broker

The people involved in the insurance industry profess that they provide security for a living, since their product is financial protection in the event of a crisis or emergency. This protection is always in demand, and the insurance industry is thus one of the nation’s largest employers, with over two million workers. Seventy percent of them are involved in administrative or sales posts in three main areas: Life, health, and property and liability. The life insurance agent collects monthly or yearly payments from a policyholder; if the policyholder dies while covered by the policy, the designated members of his family receive a substantial sum of money. Sometimes life insurance agents arrange for more creative benefits, such as college tuition payments for children. Ensuring proper coverage for hospital and doctor visits is the domain of the health insurer, who most likely works for groups of employers rather than soliciting clients among the general public. Some health insurers are employed by the government to enforce Medicaid policies. Finally, property and liability agents insure instances of damage done both to and by their policyholders. They must also be fluent in the world of health insurance since they cover workmen’s compensation; an employee injured at work will deal with this agent rather than a health insurance agent. Agents work for one insurance agency, whereas brokers work independently and sell policies through many agencies. Beyond this distinction, however, agents and brokers fill many of the same functions. Each meets with potential clients and advises them on the most appropriate coverage. When claims are made, they have to settle the claim equitably for both the client and the agency. Agents and brokers can be salaried employees of an agency or, more likely, work partly or fully on commission on the premiums they sell. Because most agents work on commission, they must spend quite a bit of time networking and finding new customers. Some large agencies cover all areas under one of the three divisions, while smaller ones specialize in one area, car insurance, for instance. Besides keeping up with customers and courting new ones, insurance agents and brokers have administrative tasks to do, such as keeping records of sales. Lucky and successful agents will have a staff to handle these matters.

Paying Your Dues

Life and health insurance agents and brokers must be licensed by their state, which means passing an insurance examination. Agents who sell investment-oriented policies must also be licensed by the National Association of Securities Dealers or the Securities and Exchange Commission. While a college degree is not necessary for these positions, many agencies are seeking college-educated applicants, and a degree is an especially good idea if you want to advance to managerial positions. Some agencies even offer training programs for undergraduates, in the hope that students will work part time while in school and become full members of the company upon graduation. Some of these programs even provide tuition reimbursement for students employed with their agencies.

Present and Future

The concept of insurance has been evolving as long as there have been communities. Thousands of years ago, for example, a form of insurance began in China when people shipped goods across the sea in sometimes hazardous conditions. Boat owners began putting a little bit of each owner’s cargo in every boat, so that if one boat sank, each owner would be sure that most of his product would still reach the shore. When European settlers came to America, each member of the community would help if one person’s house burned down. Pitching in to help rebuild someone else’s house, a community member was insuring that he would receive help if he suffered a similar loss. As society enlarged and became more complex, insurance began to take the strictly monetary form we are familiar with today. Now a person pays one amount, called a premium, to insure that if she falls victim to disaster she will be protected-at least financially. The agency charges the client a fraction of the rebuilding costs and is able to pay for any reconstruction by using the premiums of those who do not ever suffer any losses. The insurance industry is continuing to grow at an average pace. The public’s growing concern for security, an elusive concept that money seems to provide in an increasingly fragmented society, has fueled a rise in the need for insurance providers. Product liability insurance industries continue to grow as people purchase more advanced home technology. Changes seem to be ahead: Insurance may become more complicated and competitive as health care financing is rearranged, and banks may start underwriting insurance policies previously drafted by agents. Those working in insurance now have better than average chances for advancement into newly developing positions.

Quality of Life

PRESENT AND FUTURE

Insurance agents are often frustrated in the beginning of their careers. They are just learning the ropes and do not have many clients. There is a lot to learn, progress seems slow, hours are long, and paychecks are usually small.

FIVE YEARS OUT

Those agents that remain at this time find that they are working long hours to generate even greater numbers of clients. They are relieved by the familiarity of the position and enjoy seeing the occasional high paycheck.

TEN YEARS OUT

Many agents break away from their firms to become independent brokers. Others seek advancement by gravitating to the field of underwriting or becoming an actuary or adjuster.