Working as an insurance agent can be an effective way to earn a living wage while helping people. In essence, you’re helping customers protect what is most important to them. However, there are many steps that you must take before you can start working in this field. Let’s take a closer look at the process of becoming a licensed agent and how long it will likely take to complete.
What Are the Requirements to Become an Insurance Agent?
In most states, you’ll need to be at least 18 years of age to start the process of obtaining your insurance agent license. You’ll also need to consent to a background check as well as have your fingerprints entered into a national database. If you pass the license exam, you will then need to apply for your license before seeking employment in your chosen line of authority.
Should You Obtain a College Degree?
In most states, you don’t need a college degree to obtain a property and casualty license. However, it can be a good idea to pursue a degree in finance or business if you want to become an actuary or to enter other fields that typically require you to have a formal college education.
You’ll Need to Meet Classroom Requirements Before Taking Your Licensing Exam
Although you won’t need a college degree to become an insurance agent, you will likely need to complete a prelicensing course. This course can take up to 90 hours to complete depending on the state where you’d like to obtain your license and the line of authority that you wish to receive. For your convenience, it may be possible to complete such a course online.
After you complete your pre-license class, you will receive a certificate of completion. You will need to bring this certificate to your test site. In addition, you’ll need to present valid identification to sit for your chosen exam. If you fail to bring either of these documents to the test site, you’ll need to reschedule your appointment. However, you will not receive a refund for any test fees paid prior to your missed appointment.
What Should You Know About the License Exam?
The license exam primarily tests your knowledge about state rules and regulations. For instance, you’ll generally need to be familiar with concepts such as risk, indemnity or renewals. You will also need to be familiar with contractual terms such as declarations, conditions and appraisals. Finally, the test will also assess your knowledge regarding your role as an agent and the responsibilities that you have to your clients.
What Is Considered a Passing Score?
Each state has different rules it uses when determining if you have passed a specific license exam. However, 60% is often considered to be a passing score regardless of where you take the test. In some cases, your test will be graded on a scale, which means that you might be able to pass even if you don’t get 60% of the questions right. It’s not uncommon to fail an insurance agent test on your first try, and anxiety on test day is one of the most common reasons cited as to why this occurs.
How Should You Get Ready for Your Exam?
It may be in your best interest to take an exam prep course prior to actually taking the test. A prep course can help you anticipate any tricks that the exam provider may use to confuse or frustrate you into giving the wrong answer. You may also learn valuable skills that can help to calm your nerves or otherwise help you stay in control while taking the test.
Where Can You Work After Obtaining Your License?
After receiving your insurance agent license, you can work at most brokerages and independent insurance agencies in the state where you passed the exam. If you find work in another state, your license can typically be transferred to that state with relative ease. In many states, obtaining the proper credentials means that you can start your own private insurance company. Taking this step may allow you to gain greater control over your career and make significantly more money than you might working for someone else.
You May Be Subject to Ongoing Training Requirements
State and federal laws change on a regular basis, and as an insurance agent, it is your responsibility to keep up with these changes. The best way to do this is to take continuing education courses after you obtain your license. In some cases, your employer may be willing to pay for the costs associated with your continuing education.
Obtaining an insurance agent license may provide you with an opportunity to embark on a lucrative and unpredictable career path. Ideally, you’ll take test prep courses, hire a private tutor or take any other steps needed to pass the exam on your first try.
