Becoming A Licensed Life Insurance Agent: Steps To Success

Becoming a licensed life insurance agent requires passing an exam and meeting all other application criteria. The process can be completed in a few weeks, and a bachelor's degree isn't required. However, there are several steps to the process. First, you must meet the basic eligibility requirements, which include being at least 18 years old, having no fraud or felony charges, and being free of tax debt. Second, you must complete pre-licensing coursework, which covers insurance industry regulations and principles. Third, you must pass the state insurance licensure exam. Fourth, you must apply for your license and submit to a background check. Finally, once you have obtained your license, you can start selling insurance and building your client base.

Meet basic eligibility requirements

To become a licensed life insurance agent, you must meet certain basic eligibility requirements. These may vary depending on the state but typically, aspiring life insurance agents and brokers must meet the following criteria:

• Age: Be at least 18 years old, the minimum age to apply for a license in most states.
• Criminal record: Be free of any fraud or felony charges.
• Taxes: Not owe any federal or state income taxes.
• Background check: Be able to successfully complete a background check.

Some states also have additional requirements for insurance agents and brokers to be eligible for a license. For example, in some states, candidates must not have past-due child support. In New York, candidates must complete a Department-approved pre-licensing education course totaling at least 40 hours of instruction for a life, accident & health authority, or not less than 20 hours for either life-only or accident & health-only authority.

Complete pre-licensing coursework

To become a licensed life insurance agent, you'll need to complete pre-licensing coursework, which will equip you with the knowledge to prepare for your life insurance exam. The number of hours required for this pre-licensing education will depend on the state you're in and the type of license you're pursuing. For example, in California, you need 20 hours of pre-license education for a life insurance license, while a joint life, accident, and health license require 40 hours.

Some states, like Texas and Virginia, don't require a pre-license education course, but you will still need to pass the state life insurance exam. Even in these states, taking a structured study course is recommended to prepare for and pass the exam on your first attempt.

Pre-licensing education courses are typically offered by third-party organizations, and you may need to pay for them yourself unless you've already been hired by an insurance company, in which case your employer may cover the cost. These courses are often available online, making it convenient for busy professionals to study around their other commitments.

The courses will cover topics such as state insurance regulations, general insurance concepts and terms, specific policies applicable to life insurance (including underwriting, setting up policies, and policy provisions), annuities, tax considerations, and the requirements to maintain a life insurance sales agent license.

After completing your pre-licensing coursework, you'll be ready to move on to the next steps of the licensing process, including submitting your license application, completing a background check and fingerprinting, and, finally, taking the licensing exam.

Pass the state insurance licensure exam

Passing the state licensure exam is a crucial step in becoming a licensed life insurance agent. Here are some detailed instructions to help you prepare for and pass the exam:

Understand the Exam Structure:

The life insurance license exam is typically divided into two parts: a general life insurance section and a state-specific section. The general section covers topics such as types of life insurance, policy provisions, options, and general life insurance topics. The state-specific section focuses on your state's rules and regulations, including licensing requirements, contract language, disclosures, and rules pertaining to the life insurance policy.

Choose a Study Program:

Enrolling in a structured study program, such as Kaplan's online courses, can significantly increase your chances of passing the exam. These programs offer comprehensive study packages and have a high pass rate. They will help you cover all the relevant topics and ensure you are well prepared.

Develop a Study Schedule:

Create a study plan that considers your other commitments and allows sufficient time to cover all the material. Aim for consistency and dedicate specific blocks of time each day to complete your pre-education course modules. It is recommended to spend a couple of hours each day on your pre-license education, with additional time for practice questions and tests.

Master Key Topics:

The life insurance exam covers a range of topics, including general insurance terms, life insurance basics, types of life insurance policies, annuities, state regulations, tax implications, and more. Familiarize yourself with these topics and focus on understanding the concepts rather than just memorizing.

Practice, Practice, Practice:

Take advantage of practice questions, mock exams, and vocabulary quizzes. The more you expose yourself to exam-style questions, the better your understanding of the material and your confidence on exam day. Practice tests also help you identify areas that need further review.

Take Care of Yourself:

In the lead up to the exam, prioritize self-care. Get plenty of rest, eat nutritious meals, and stay active. A well-rested and energized mind will help you stay focused and perform at your best during the exam.

Know the Exam Day Requirements:

Familiarize yourself with the exam day requirements and procedures. Arrive at the testing center early, usually about 30 minutes before the exam start time. Bring the required identification and any necessary documents, such as your exam admission ticket and pre-licensing education completion certificate. Leave prohibited items, such as personal electronic devices and bulky jackets, at home or in your vehicle.

Stay Calm and Focused:

It is natural to feel anxious on exam day. Remember to stay calm and trust your preparation. Focus on the exam and try to avoid getting overwhelmed. Read the questions carefully, manage your time effectively, and answer confidently based on your knowledge.

By following these instructions and maintaining a disciplined approach to your studies, you will be well on your way to passing the state insurance licensure exam and becoming a licensed life insurance agent.

Apply for your life insurance license

Once you've passed your state licensure exam, you can apply for your life insurance license. You can submit your license application to your state's department of insurance regulation. You should wait at least 48 hours after passing the licensure exam.

You can fill in the application form online on the state department's website. You will also need to pay a licensing fee, which varies between states. If you're applying for a health insurance license, you will need to pay a separate fee.

The insurance regulation department will review your application. There is often no set timeframe for this as the department treats each license application differently. If something comes up from the background check, the department may contact you to clear things up. This can also delay the process.

You can find out if your application has been approved through the department's website. Once approved, you can ask for a copy of your life insurance license. Some departments don't mail printed licenses, so you may need to download your license and print it yourself.

If you feel that there's a delay in processing or your application is erroneously rejected, you can also contact the department to provide clarity.

The entire process of getting a life insurance license can take between two and eight weeks. You will be spending a big chunk of this time completing your pre-licensing coursework and studying for the state licensure exam.

Additional Licensing Requirements

If you will be marketing and selling securities or variable-contract life insurance products, you will also need to be licensed through the Financial Industry Regulatory Authority (FINRA) and the North American Securities Administrators Association (NASAA).

Get appointed by an insurance company

To get appointed by an insurance company, you must have a license to sell life insurance in your state and meet any additional requirements set by the insurance company you wish to represent. Here are the steps to get appointed by an insurance company:

Decide what kind of insurance agent you want to be

There are two types of insurance agents: captive and independent. A captive agent works exclusively with one company and sells only their products. On the other hand, an independent agent works with multiple insurance companies and provides clients with policy quotes from different insurers.

Decide what type of life insurance you want to sell

You should also consider what type of focus you want to have. For example, do you want to sell term life insurance, whole life insurance, or universal life insurance? Knowing your niche will help you decide which companies to apply to and build relevant experience.

Research different insurance companies

Researching insurance companies will give you a better understanding of the product you'll be selling and the company's environment. Make a list of what you want in a life insurance company, and check employee reviews, customer reviews, and financial ratings.

Prepare your resume and documents

When it comes to getting appointed, polishing your resume is essential. Highlight any sales skills or business initiative experience, as well as any remote work or self-driven projects. You will also need your insurance license paperwork ready for submission.

Submit applications

Most companies will have a place on their website to submit an application. You can also research jobs on job-hunting sites or drop off your resume in person if there is an office nearby.

Interview process

If your application is successful, the company will likely conduct a phone interview, followed by an onsite interview.

Sign the contract

If you are approved and offered an appointment, the final step is to sign a contract accepting the position.

Be persistent

Part of getting appointed is persistence. Strengthen your resume and be diligent in your applications. Most of the hard work is earning your license and building relevant experience.

Frequently asked questions