How to Practice Insurance Brokerage Business

Insurance brokerage: Most people don’t want to think about their own death, which is why life insurance can be a hard sell and an even harder career to break into. Being a life insurance broker has its ups and downs, but it can be a rewarding and lucrative job. Before getting started, be sure you understand what is required, how to become licensed and how to sustain your business.

Insurance brokerage

Learn the requirements in your state. Most states have adopted the National Association of Insurance Commissioners (NAIC) Producer Licensing Model Act, which requires brokers and consultants to gain a license.

  • States such as Illinois, Rhode Island, Colorado, Georgia, Kansas and Indiana have additional requirements before consultants are able to sell insurance, including being contracted with an agency.
  • Some states require license applicants to be sponsored by an employer.
  • Check your state’s Department of Insurance website for specific information on licensing requirements, training essentials and examination locations.
  • Some states require that you complete prelicensing education before taking the exam.

Obtain a college degree. While a college degree isn’t required in most states, it’s recommended to have an educational background or degree in business law, accounting, marketing, economics, mathematics or computer programming.

  • These and similar fields provide education and training that is most applicable to a career selling life insurance.

    Insurance brokerage

Find a training course. The training program will cover topics included on the license exam and will ensure you’re properly prepared for the license exam. Check with your state’s Department of Insurance website for details.

  • Insurance License Express is an online resource that provides state-specific information, materials and courses to prepare for the licensing exam.
  • Companies like Kaplan have life insurance license training available.
  • Some states, like Illinois, require that you complete your training in a classroom setting.

Complete your training. Your training program should provide all the information you need to feel ready to take the licensing exam.

  • Roughly 40 hours of the training should cover the basics of selling insurance.
  • Training should include up to 12 hours of ethics courses.

    Insurance brokerage

Take a practice exam. Just like the ACT and SAT exam, a practice run can help ease anxiety and give you a solid idea of what to expect. You can find practice questions and sample tests online.

  • Be fluent in life insurance basics, policy options and provisions, tax considerations, annuity policy information and qualified life insurance plans.

Get a background check. Some states will require you to get fingerprinted and go through a background check before getting a license.

  • This requirement should be listed on your state’s Department of Insurance website.

    Insurance brokerage

Pay your dues. The National Association of Insurance Commissioners provides a state-by-state breakdown of the cost and requirements you must meet before taking the exam to get your life insurance license.

  • Fees range drastically, but can be up to a few hundred dollars.

Take the test. Find your closest exam location, which is typically listed on your state’s Department of Insurance website, and schedule it within enough time to feel appropriately prepared and confident.

  • Ensure you have paid the appropriate fees for the test. Typically you’ll be required to pay these fees before getting to your exam location.
  • Double check what you need to bring the day of your test.
  • Be familiar with the route to the exam center and prepare yourself for heavy traffic by giving yourself more than enough time to arrive.
  • Read all questions and answers thoroughly before answering. Take your time with the questions but avoid over-thinking the correct answers.

    Insurance brokerage

Apply for a license to be a life insurance broker. You must submit the application, proof of education and proof that you passed a state exam to your state’s insurance department. You must renew the license after a period of time, which is typically every two years.

Gain experience in the field. Hands-on experience in entry-level positions, such as being an insurance claims representative can help you understand the processes and daily duties of a life insurance broker.

  • Assist customers directly in regards to their insurance claims.
  • Look for a position where you can build strong problem solving, interpersonal, customer service and communication skills.

Decide if you want to go through an agency or be independent. There are numerous benefits to each side of the coin. Going with an agency can provide a little bit more stability. Agencies will receive more leads and distribute them among their employees. Agents working in an agency setting will also have more time to spend on cases instead of searching for clients. However, working with an agency limits the choice you may have on what type of cases and clients you can to work with.

  • The Independent Life Insurance Agent Association provides materials, guides and free webinars to those who take the solo route.
  • Independent life insurance agents have to find their own leads, which can take more time and work. This, however, is an ideal situation for people who want to work on specific cases.

    Insurance brokerage

Establish an office. Typically insurance agents are considered independent contractors instead of full-time employees so working from home is common even if you are working within an agency.

  • Purchase a desk, computer, business cards, stationery and printer. Your home will be your office so provide yourself with all the supplies you need to be successful.
  • Create a clean space where you can focus, ideally in a corner or separate room.
  • Find a local coffee shop or cafe where you can meet with new and potential clients.

Market yourself as a business. Create a website, allocate monthly funds to advertisements and build your personal network.

  • If you’re working independently, building strong relationships is especially important. Word of mouth is key to success, so think of yourself as a brand.
  • Always be on the ready to sell yourself as a representative. Always have business cards, flyers and any other marketing materials handy.
  • Start a blog. Written content is a handy tool to show potential clients that you are educated and can provide valuable information. Start a blog with how-to articles and listicles that are easy to read.
  • Utilize social media for advertisements, like Facebook and Instagram advertisements.
  • Create a more personal online brand by uploading videos with valuable information to your website and social media channels.

    Insurance brokerage

Become a member in industry associations. The National Association of Insurance and Financial Advisers, the National Alliance of Life Companies and the National Association of Independent Life Brokerage Agencies are reputable organizations.

  • Join organizations with a strong presence in your area to get the most from group training and networking opportunities.
  • Some agencies will pay your membership fee for industry associations.
  • Organizations often host conferences over the nation and being a member means you typically get a discounted ticket.
  • Membership dues vary and can reach up to several hundred dollars. Members, however, get access to educational opportunities to learn about new products, services and more.

Become a certified life insurance broker. Organizations like the American Institute for Chartered Property and Casualty Underwriters and the National Alliance for Insurance Education and Research offer courses and exams to gain different designations and levels of expertise.

  • Though completely voluntary, certification can help you stand out from the competition.
  • Being certified is similar to earning your master’s degree or additional certifications in other careers.

    Insurance brokerage

Continue your education. It’s required by most states that life insurance consultants must renew their license every two years. Keep yourself abreast of updates in law, tax and ethics policies.

  • Attend webinars, conferences and local gatherings with fellow industry professionals.
  • Network with new circles in your area to learn about different methods and services.

Nail down your pitch. Make sure your sales pitch and presentation are thorough and practiced, highlighting the key areas of interest to your potential customer.

  • Listening is important. You have to be able to hear what the potential client really wants and be able to provide them with a plan that fits their needs.
  • Explain the parts of a life insurance policy that will benefit a customer most.
  • Be persistent at following up after every appointment but be careful about not being too aggressive. No client wants to feel bullied into buying a policy.

Insurance brokerage

More tips

  • Brokers who sell life insurance plans that are tied to investments must also be registered and licensed with the Securities and Exchange Commission or the National Association of Securities Dealers (NASD). That requires another test and considerable preparation.

  • Be patient. In any career that requires you to build your clientele, it can take time to develop contacts and build relationships.


  • Different agencies may offer you a bonus or other incentive for selling a particular policy. Be aware that sometimes these policies are not the best for your clients needs. Always keep your client in the highest priority.

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