How to Become an Insurance Broker

What Is An Insurance Broker?

Insurance brokers are trained professionals in insurance and risk management solutions who help individuals and businesses find insurance policies that best meet the needs of their customers. Some specialize in a single type of insurance, such as home, auto, life, or health, while others work with a variety of these as well.

Insurance brokers must be well-versed and articulate to explain complicated insurance terms to clients, regardless of the type of insurance they sell. Before insurance brokers can sell policies, they must be licensed in a specific area of insurance. Most students complete four-year degrees.

Becoming An Insurance Broker

If you want to be a successful insurance broker, you need to know everything about the industry. Competitors in the market include both captive and independent agents, each of whom works for a different company. In many cases, the breadth and depth of industry expertise possessed by successful brokers are superior to that of both captive and independent agents.

Among your responsibilities will be conducting policy research, giving financial and risk management advice, preparing reports, keeping records, and developing new client relationships. Here are the steps you need to take to become a broker of insurance.

Earn A Bachelor’s Degree

A bachelor's degree isn't required, but having one on your resume can help you land a job at an insurance brokerage. Finance, accounting, business law, and marketing are all topics covered in business administration and economics degree programs. Psychology, sociology, public speaking, and communications are other subjects that may be beneficial to students.

Alternatively, you may want to pursue a bachelor's degree in insurance and risk management. Unlike programs in business administration or economics, these aren't as widely accessible. They not only teach the basics of business, but they also cover the theory and practice of various types of insurance, such as life, health, and property.

Consider Doing an Internship

Internship opportunities with insurance companies are available in some insurance and risk management bachelor's programs. As an intern, you'll have the opportunity to observe and participate in company operations. You may be required to write a summary of your experience, while your employer may provide a written evaluation. If your school does not offer internships, you can always set one up on your own.

Get an Insurance Broker License

A broker's license is required in every state where your business will operate. Insurance licenses can be obtained in the areas of life, property, and casualty. For example, brokers and agents have different licensing requirements, but brokers can hold an agent's license and work for companies as an agent, even though brokers have different licensing requirements.

In some states, agents and brokers must both obtain a producer's license instead of having separate licenses. Agents and brokers in the insurance industry are referred to as "producers."

To become an insurance broker and be able to sell a variety of financial products, you'll need to pass an insurance broker exam, such as the series 6 or series 7 exams offered by the Financial Industry Regulatory Authority.

Find an Entry-Level Position

An entry-level position at an investment bank will most likely be in customer service or as a broker's assistant.

Customer service reps process insurance transactions under supervision, personal lines representatives provide detailed coverage for houses and personal belongings, and commercial lines representatives provide comprehensive coverage for businesses (commercial and business insurance).

Positions as a department supervisor, producer, or branch office manager may become available if you show initiative, competence, and leadership.

Insurance Broker Certification

Consider obtaining certification in an area of insurance in which you've developed expertise for the purpose of furthering your professional development and job prospects. There are a number of voluntary certifications available to independent brokers and agents from NAIER. CICs, CISRs, and CRMs are all examples of these certifications.

The HIA certificate from America's Health Insurance Plans is available to those with a desire to work in the healthcare industry. 

The Certified Financial Planner Board of Standards (CFP) offers the Certified Financial Planner credential if you are interested in financial planning. It takes three years of experience and passing an exam to become a Certified Financial Planner (CFP), as well as three years of education in the field of financial planning.

What Other Career Options Are There?

Insurance underwriting is a good option if you're looking for a similar insurance career. Clients' insurance coverage and premiums are determined by an insurance underwriter.

Using the information provided in an insurance application and their sharp analytical skills, these professionals can determine the overall risk a client poses. In order to work in insurance underwriting, you'll typically need a bachelor's degree.

Being a personal financial advisor may be a career path for you if you enjoy giving advice to others. Individuals in this position should be knowledgeable about a wide range of financial topics such as insurance and retirement plans, finances, mortgages, and so on. Good interpersonal skills are essential. In order to work in business or finance, a four-year degree is typically required.

It's possible to start your own insurance brokerage if you have enough money, experience, and contacts in the insurance industry.