Insurance Sales: Should You Work for an Agency or Yourself?

Insurance sales is a booming industry, with a 22 percent growth expected between 2010 and 2020, according to the U.S. Bureau of Labor Statistics. After becoming certified, you'll find jobs are plentiful, but you have an important decision to make: should you join an agency or work for yourself? Assessing the advantages and disadvantages of both working arrangements will help you make a more informed choice.

Generating Leads

Insurance written in Scrabble letters.

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Lead generation is handled very differently in agencies and independent firms. An insurance sales agency will receive leads and assign them to their employees. These employees may occasionally generate their own leads, but the bulk of their work will come from higher up. Many insurance salesmen who work for an agency like this, as they can spend more time working on cases and less time searching for clients. However, it also limits choice. Some insurance sales employees may find that they're becoming pigeonholed and not using their wide breadth of insurance knowledge.

Insurance sales professionals who love diversity may be more attracted to life as an independent agent. These professionals are responsible for chasing up their own leads, so they can take on cases that interest them. This process can be time-consuming and frustrating during slow periods, but the varied business it brings can also be rewarding. 

Striking the Right Work-Life Balance

Agency workers and independent insurance sales agents both have aspects of their job that help them find the right work-life balance. Independent professionals don't have employers to answer to, so they can set their own schedules and only work when they want to. That means they needn't miss their son's soccer game or a special birthday lunch.

However, whenever independent insurance sales professionals are not working on cases, they're not making money, so those vacations can make a real dent in finances. The same is true for time spent chasing down leads, which is something that agency workers don't have to worry about. Many independent insurance sales agents put in long hours chasing down leads and working hard for their clients. They often tend to work odd hours, to fit in with the schedules of their clients, and travel more than agency workers, so they call on customers out of their local area.

On the flip side, motivated independent insurance professionals have the power to boost their incomes by putting in more work. If they're preparing for the arrival of a new baby or saving up to buy something special, they can increase their hours and reap the financial rewards.

Many agency workers enjoy a more traditional working schedule than their independent peers, and this can be a real benefit. If they want a vacation, they can rely on their colleagues to cover for them. However, they are expected to work regular business hours and only take two weeks' annual leave. Agency workers may also find their work-life balance disappearing as they put in extra hours to meet expected quotas. 

Building a Social Network

One of the biggest advantages for insurance professionals working for insurance agencies is the camaraderie that comes from being part of a large team. Water cooler conversations, Friday afternoon drinks, and Christmas parties are some of the social perks these employees enjoy.

Insurance sales is a social industry, but independent professionals will find that chatting with a client about their case isn't quite the same as the interoffice banter that agency workers enjoy. Many independent contractors work alone, or with just a handful of people, which can be a little lonely. However, this can be a perk for some people who are naturally introverted. 

Serving Clients

Insurance agencies sell the policies of several different companies. The 53 percent of American insurance sales professionals who work for these corporations can feel confident that they're recommending the right products for their clients, as they have many different policies to choose from. It's very satisfying for these workers to know they've found policies that give their customers the best coverage for their money.

Some independent salespeople work in the same way, but this isn't very common. Most independent insurance agents enjoy the security and bonuses that come from working with major insurance firms. This means that they can only sell the policies offered by their parent companies, which can be frustrating for an insurance professional who doesn't feel that any of the products his parent company offers is exactly the right fit.

It's not uncommon for independent salespeople bothered by this restriction to use their time working as independent contractors for insurance companies. This strategy provides the agent with stepping-stones that can lead to a becoming a completely independent agent, allowing the agent to sell whichever policies he/she likes.

Many insurance salespeople who aren't independent professionals also work for single insurance firms. These individuals typically face the same frustrations as the independent professionals that liaise with larger parent companies. With a limited number of insurance products offered, it can be challenging to find the right one for every client.

Building Your Reputation

Independent insurance agencies have the ability to carve out a reputation for themselves in the insurance sales industry. With some experience, an independent professional can build a loyal client base of preferred customers. These people will return to their independent insurance professional whenever they want to expand their insurance portfolio, and may even come to regard their insurance agent as a trusted friend more than a professional acquaintance. Most insurance salespeople that work for agencies don't get the chance to build these same bonds with customers, as they're only small cogs in a much larger machine.

However, this can be a relief for some insurance sales professionals. They love being able to trade on an established firm's credibility, rather than needing to carve out their own reputation. They appreciate that they don't need to worry about facing competition from larger insurance firms to land cases.

There are real benefits and some drawbacks to working with an insurance sales agency or as an independent agent, so it's important to consider these carefully when deciding which role would suit you best. 

Contributed to by Kim Evans

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