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An independent insurance agent is an insurance professional licensed to sell products from a variety of insurance companies. They differ from employed insurance agents, who only represent one insurance company or product line. While many independent insurance agents specialize in one type of insurance, such as life, health or property and casualty, some sell several different types of insurance from different companies. For example, if you visit an independent insurance agency, the agents working there may be able to sell you auto, home, life, health and other types of insurance.
To become an independent insurance agent, you need to obtain a license from your state for the type of insurance you wish to sell. Most states have education and testing requirements that must be met before you can earn your
license. Once you are authorized to sell insurance, you can approach companies to represent its products. Insurers may require you to complete specialized training and provide a business plan for selling its products.
As an insurance agent, an advantage for being independent is flexibility. You can tailor your product line as you see fit and command higher commissions. Independent agents are self-employed and determine their own business model and planning.
A major drawback for independent insurance agents is the decreased level of support from insurance carriers, particularly for marketing assistance. Some insurance companies offer subsidized or cooperative marketing dollars for independent agents, but generally independent agents must find their own clients. In contrast, agents employed by an insurance company benefit from the name recognition and national advertising supplied by the large insurance carriers.