How Much Do Insurance Agents Make?

A career as an insurance agent can be very rewarding. Depending on where you live, what type of insurance you sell, and whether or not you are an independent agent, you could have limitless potential with what you bring in. While selling insurance presents unique challenges, it’s a career path many choose because of the earning potential. So just how much do insurance agents make annually? Let’s dive further into the salary potential below.

What Does the Typical Insurance Agent Make?

According to the Bureau of Labor Statistics, the median wage for insurance agents sat at $49,840 as of May 2021. The highest 10% of all insurance agents earned more than $126,510, while the lowest 10% earned less than $29,970.

In essence, 50% of all insurance agents made more than $49,840 in 2021, while 50% made less. The BLS also reported that the median wages varied greatly depending on the specific industry. For example, the median salary for direct health and medical insurance carriers was a whopping $70,570. On the other hand, direct insurance carriers—except life, health, and medical—averaged $57,990. Meanwhile, insurance agencies and brokerages came in at $48,830.

What Affects How Much an Insurance Agent Makes?

The figures above show a relatively large spread in salary. That’s because determining how much agents make is not an apples-to-apples comparison. Here are some of the main factors that affect how much an insurance agent makes.

Captive or Indpendent

Perhaps the most significant factor in how much an agent makes is whether you are captive or independent. As a captive agent, you will work as an on-staff employee of an individual insurance company. As a result, you will be able to sell that company’s products and receive a lot of tools and support in return.

Captive agents typically earn a base salary and a commission based on their sales. While this provides a guaranteed minimum wage, it also limits some earning potential.

Independent agents, on the other hand, are essentially small business owners. Therefore, they can run their business however they wish, including selling products from multiple insurance companies.

From an earnings perspective, the sky is the limit. Independent agents can usually earn more than captive agents since they’ll get better commissions directly from insurance companies, but they won’t have the guaranteed base that captive agents do.

Structure of Commissions

The reason for the discrepancy between the two is the different commission structures. Captive agents may earn a commission of between 5% and 10% of the initial year’s premium for auto and home insurance, for instance. However, for that same policy, independent agents average roughly 15%.

As mentioned, this gives independent agents a higher ceiling regarding their earnings potential. But, again, the trade-off is that they have a much lower floor in guaranteed wages than captive agents.


Where you live is a significant factor in how much you can earn as an insurance agent. For example, the state with the highest average salary for insurance agents is Hawaii, at $74,219. Conversely, the state with the lowest average salary is Vermont, at $39,804. There are also potentially large salary ranges by location within a state. For example, agents typically make less in rural areas than in suburban areas near a major city—depending on what type of insurance they sell. Discrepancies are also present in regions based on the average income of that region.

That said, agents can carve out a niche with specialty insurance in the right market. For example, farming insurance could be lucrative in rural areas. In other places, you could offer specialty insurance policies for personal trainers, aircraft, and food trucks. If you know your market well and get creative in serving it, you could make a solid career for yourself no matter where you do business.

Insurance Type

What type of insurance you sell affects how much you can earn as an agent. Much of this revolves around the fact that the pay structure is different for the different insurance policies.

For auto and home insurance, for instance, agents will typically earn a percentage of the premium on the policy. They’ll then also take home a portion of each policy renewal. This provides the potential for exponential savings growth if you can build upon your customer base and keep them with you.

With health and life insurance policies, agents will make a more significant cut of the initial sale. However, while they’ll also receive a percentage of the policy renewal, it’s typically at a lower rate than auto and home.

Discover the Good Life

So, how much do insurance agents make? We hope this guide helps answer your question! As you can see, there are many financial advantages to transitioning from a captive agent to an independent agent. And while becoming an independent insurance agent can seem like an overwhelming task, it doesn’t have to be when you have a team of experts on your side.

With the proper support at hand, you can take this exciting next step in your career with ease and confidence. If you’re ready to discover the Good Life, explore our business services and insurance carriers, or contact us today to learn more about careers with GLIA. Thanks for stopping by our blog; we hope to help you soon!