Insurance Commission Splits – How It Works [Essential Guide]

Health Insurance

Health insurance offers commission splits similar to long-term or life insurance. So, after selling a policy, an agent will earn the largest commission, followed by a smaller amount on each regeneration. The major distinction is that most health insurance policies are valid for three years only.  

Property & Casualty Insurance

Casualty, automobile, home, and other property insurance plans are not as long-lasting as the other two. As a result, the commission model is based on a significantly smaller percentage. This typically ranges between 5 to 20%, with regenerations even lower.  

Additional Variables

The other factors influencing how much commission an insurance agent earns on a type of insurance are:

Client support

It refers to the agent’s assistance a client receives during and after the sale of the first policy. Building relationships with clients, staying in touch, offering them possibilities for new coverage or cost savings, and so on are all examples of excellent assistance.  

Lead Generation

When an agent fully generates their leads requirement, they can expect to earn high commission. However, the agency might reduce the commission by using a software platform that assists in lead generation.  

Marketing Strategies

This, like lead generation, can result in a reduction in an agent’s commission. An agency may invest in a tool that increases overall marketing efforts in some cases. It could be a cutting-edge software application or a well-designed insurance agency website. It, however, opens the possibility of developing a more extensive client base, which translates to more business and, thus, more commission.  

Partnerships

If two agents work together on a customer, the commission will be divided. Although this isn’t typical, it occasionally happens, particularly when targeting a large client.