Please help Explain the Math: Life Insurance Commision

[WISECREDIT19]

Hi everyone! I am new to this forum and the insurance industry and recently got an offer to work for a SF agent. I am curious about two things in the commission structure - (1) Selling whole life insurance, I will receive 100% of 1st month and (2) selling Universal life, I will receive 10% of the annual premium. Can someone please give me a numerical (realistic) example of how much I can expect to receive in these two conditions. Thanks for your help!

 

[goillini52]

Hi everyone! I am new to this forum and the insurance industry and recently got an offer to work for a SF agent. I am curious about two things in the commission structure - (1) Selling whole life insurance, I will receive 100% of 1st month and (2) selling Universal life, I will receive 10% of the annual premium. Can someone please give me a numerical (realistic) example of how much I can expect to receive in these two conditions. Thanks for your help!

$50 a month X 100% = $50.

$600 a year X 10% = $60.

Get a calculator and welcome to the Forum..."You're In Good Hands" with Farmers.

 

[scagnt83]

State Farm is the last company I would sell Life Insurance for. What most of their life agents make their first year is about equal to minimum wage after they deduct expenses and consider total time invested.

Normal captive insurance agencies pay agents 55% of the first years premium on WL and Term. Sometimes a bit more for longer Term periods.

Independent agents make anywhere from 75%-100% on Term and 55%-100% on WL/UL ... and thats on the Annual Premium.

So to compare the math to SF:
Normal Life Carrier Captive Agent comp on $600 annual premium= $330 - $400
Independent Agent comp on $600 annual premium= $330 - $600



If you want to sell Life Insurance go work for a real Life Insurance Company. Not a P&C carrier who sells life insurance on the side. (that used to not be the case for SF but it is now imo)

NYL, NWM, Mass, Guardian, Mutual of Omaha, Ohio National, Axa, TransAmerica, Penn Mutual. All of those would be good starting points for a new Life Agent. State Farm would be close the the bottom of my recommendations.

 

[rcduggan]

Hi everyone! I am new to this forum and the insurance industry and recently got an offer to work for a SF agent. I am curious about two things in the commission structure - (1) Selling whole life insurance, I will receive 100% of 1st month and (2) selling Universal life, I will receive 10% of the annual premium. Can someone please give me a numerical (realistic) example of how much I can expect to receive in these two conditions. Thanks for your help!

what agency is this by the way? i am also in SF

 

[DHK]

Hi everyone! I am new to this forum and the insurance industry and recently got an offer to work for a SF agent. I am curious about two things in the commission structure - (1) Selling whole life insurance, I will receive 100% of 1st month and (2) selling Universal life, I will receive 10% of the annual premium. Can someone please give me a numerical (realistic) example of how much I can expect to receive in these two conditions. Thanks for your help!

100% of $0 of premium is $0.

Harsh? Probably. Realistic? Probably.

While I don't know (nor care) about State Farm's compensation plan to agents, selling life insurance and financial services is VERY profitable... IF they know how to go about it. If they are trying to delegate that process to someone new... that tells me they don't know how to sell life insurance.

State Farm, as a company, sells a LOT of life insurance, but that doesn't mean they are necessarily GOOD at it. They may be setting you up to fail if they can't teach you how to sell or cross-sell life insurance. That may also explain why the commission %'s you quoted are so VERY low.

Payout commissions won't matter unless you have a SOLID method of prospecting, fact-finding, presenting, and closing for life insurance needs. I hope, for your sake, that the agent that is looking to hire you has that process to train you.

 

[VolAgent]

100% of $0 of premium is $0.

Harsh? Probably. Realistic? Probably.

While I don't know (nor care) about State Farm's compensation plan to agents, selling life insurance and financial services is VERY profitable... IF they know how to go about it. If they are trying to delegate that process to someone new... that tells me they don't know how to sell life insurance.

State Farm, as a company, sells a LOT of life insurance, but that doesn't mean they are necessarily GOOD at it. They may be setting you up to fail if they can't teach you how to sell or cross-sell life insurance. That may also explain why the commission %'s you quoted are so VERY low.

Payout commissions won't matter unless you have a SOLID method of prospecting, fact-finding, presenting, and closing for life insurance needs. I hope, for your sake, that the agent that is looking to hire you has that process to train you.

Just an FYI. The State Farm agent probably is not looking to be good at it, nor does he really want someone good at it.

He wants to sell enough to earn his bonuses and if he is smart to help his retention. That's it. I have a cousin who is a State Farm agent. In the past he has told me every year he has to find someone to buy some mutual funds so he'll get his bonus.

 

[myinsurebiz]

Hi everyone! I am new to this forum and the insurance industry and recently got an offer to work for a SF agent. I am curious about two things in the commission structure - (1) Selling whole life insurance, I will receive 100% of 1st month and (2) selling Universal life, I will receive 10% of the annual premium. Can someone please give me a numerical (realistic) example of how much I can expect to receive in these two conditions. Thanks for your help!

Tell them you want a Top Contract . . .

Good Luck and Happy Holidays . . .

 

[ExProgrammer]

what agency is this by the way? i am also in SF

Don't look now but I believe that in this case SF = State Farm, not San Francisco.

 

[marindependent]

It could mean either the way the post is written. It seems like everyone is assuming that this person means State Farm, which is probably the most likely scenario.