How long does it take to start making money selling life insurance?

Asked by: Devin Hamill  |  Last update: March 29, 2025
Score: 4.8/5 (42 votes)

Most businesses don't make any profit in their first year of operating. It could take anywhere from 18 to 24 months for your insurance sales to actually provide profit. Don't feel discouraged. Every small business owner has to clear this hurdle.

Is it hard to make money selling life insurance?

In summary, selling life and health insurance can be lucrative, especially for those who are skilled in sales, understand the market, and are willing to invest time in building their business. However, success often requires hard work, dedication, and a strategic approach to client acquisition and retention.

How long does it take to make money as a life insurance agent?

Whether you are selling them to employers or individuals, these policies tend to be large, with significant annual premiums. In the first year, a life insurance agent can earn anywhere from 30% to 90% of this premium, along with 5% to 10% of premiums paid in later years.

How to be successful your first year selling life insurance?

Skills For Being Successful at Selling Life Insurance
  1. Customer Service Focus. ...
  2. Great Communication Skills. ...
  3. Networking Skills. ...
  4. Term Life Insurance. ...
  5. Permanent Life Insurance. ...
  6. Life Insurance Add-ons. ...
  7. Complete Your State's Pre-Licensing Education Requirements. ...
  8. Prepare for the Life Insurance Licensing Exam.

How long does it take to build cash value on life insurance?

How fast does cash value build in life insurance? Most permanent life insurance policies begin to accrue cash value in 2 to 5 years. However, it can take decades to see significant cash value accumulation. Consult a licensed insurance agent to understand the policy's cash value projections before applying.

How to Sell Life Insurance

24 related questions found

What is the cash value of a $10,000 life insurance policy?

Say, for example, that you purchase an insurance policy with a face value of $10,000. Once the policy matures, the cash value of the policy should equal $10,000.

What is the cash value of a $25,000 life insurance policy?

Examples of Cash Value Life Insurance

An example is a cash value life insurance policy with a $25,000 death benefit. Assuming you don't take out a loan or withdraw, the cash value accumulates to $5,000. After the policyholder's death, the insurance company would pay out the full death benefit, which would be $25,000.

Is life insurance sales stressful?

Insurance sales jobs are highly stressful with little pay guarantee and is an industry with a high quit rate. To be successful in the industry, new agents should understand the skills and attributes that are common among top producers.

Which insurance is best to sell?

Life insurance is the most profitable—and the hardest—type of insurance to sell. With the highest premiums and the longest-running contract, it brings in cash over a long period of time. In the first year, agents make the largest annual sum on a policy, bringing in anywhere from 40–120% of the policy premium.

How much do life insurance salesman make per sale?

Commission structures vary by policy and company. But typically, life insurance agents receive as commission 60% to 80% of the premiums you pay in the first year. They collect smaller commissions in subsequent years. Added up, 5% to 10% of all the premiums you pay over the life of the policy could go to commissions.

How many policies does an insurance agent sell per month?

How many policies does an insurance agent sell? According to the financial reports, the Official Number is 2.5 policies per month. However, many people just do it part-time.

Which life insurance company pays agents the most?

Top paying companies in Insurance for Life Insurance Agent are National Agents Alliance, New York Life, and National Income Life.

What are the pros and cons of selling life insurance?

Selling your life insurance: pros and cons
  • No more monthly premiums.
  • Higher payout than surrendering or lapsing.
  • Use the proceeds for anything.
  • You may be taxed on your life settlement proceeds.
  • Beneficiaries may get a reduced or no death benefit.
  • You may not qualify for another life insurance policy.

What are the cons of being an insurance agent?

Cons of a career selling insurance
  • Unpredictable income. Working in a commission-based role has its drawbacks. ...
  • High-pressure work environment. Selling insurance can be stressful. ...
  • Finding new leads can be challenging. ...
  • Limited paid time off. ...
  • Experiencing a lot of rejection.

How do I get started selling life insurance?

Essentially, to get started, you need to meet your state's pre-licensing education requirements, pass a licensing exam, and obtain a license and a National Producer Number from the National Association of Insurance Commissioners.

Can I become a millionaire selling insurance?

Some agents, advisors, and multi-line agents made a million dollars in the first year they worked with us selling life insurance! While most of the others it took 2, 3, or more years to make a million dollars per year selling life insurance.

What type of insurance pays the most commission?

While there are many kinds of insurance (ranging from auto insurance to health insurance), the most lucrative career in the insurance field is for those selling life insurance.

What kind of insurance is the most profitable?

Understanding Profitability in Insurance Sales

While various types of insurance are available, life insurance stands out for its profitability and long-term benefits.

How fast can you make money selling life insurance?

Most businesses don't make any profit in their first year of operating. It could take anywhere from 18 to 24 months for your insurance sales to actually provide profit. Don't feel discouraged. Every small business owner has to clear this hurdle.

What is the risk of selling life insurance?

Creditors might be able to claim the money you receive from selling your life insurance. Benefits could be threatened: Are you receiving government benefits such as SNAP benefits or Medicaid? You'll want to make sure that you won't lose those benefits if you receive money from a life insurance settlement sale.

Why do insurance brokers quit?

There's two big reasons why insurance agents quit: they don't feel valued, and they aren't given the technology they need to do their jobs well.

How much cash is a $100 000 life insurance policy worth?

A typical life settlement is worth around 20% of your policy value, but can range from 10-25%. So for a 100,000 dollar policy, you would be looking at anywhere from 10,000 to 25,000 dollars.

What disqualifies life insurance payout?

Life insurance proceeds can be denied. Some denials are legitimate, like in case of policy lapses, material misrepresentations, or exclusions in the form of illegal activities or war. In other cases, bad-faith insurers use elaborate methods to reject claims so they do not have to pay the proceeds.

Can I borrow from my life insurance?

You can only borrow against a whole life insurance policy or a universal life insurance policy. Policy loans reduce the death benefit if not paid off. Life insurance companies add interest to the loan balance, which if unpaid can cause the policy to lapse. Only permanent life insurance builds cash value.