Virginia VIEW: Nature of Work

Insurance Sales Agents

Nature of Work

Most people have their first contact with an insurance company through an insurance sales agent. These workers help individuals, families, and businesses select insurance policies that provide the best protection for their lives, health, and property. Insurance sales agents who work exclusively for one insurance company are referred to as captive agents. Independent insurance agents, or brokers, represent several companies and place insurance policies for their clients with the company that offers the best rate and coverage. In either case, agents prepare reports, maintain records, seek out new clients, and, in the event of a loss, help policyholders settle insurance claims. Increasingly, some may also offer their clients financial analysis or advice on ways they can minimize risk.

Insurance sales agents sell one or more types of insurance, such as property and casualty, life, health, disability, and long-term care. Property and casualty insurance agents sell policies that protect individuals and businesses from financial loss resulting from automobile accidents, fire, theft, storms, and other events that can damage property. For businesses, property and casualty insurance can also cover injured workers' compensation, product liability claims, or medical malpractice claims.

Life insurance agents specialize in selling policies that pay beneficiaries when a policyholder dies. Depending on the policyholder's circumstances, a cash-value policy can be designed to provide retirement income, funds for the education of children, or other benefits. Life insurance agents also sell annuities that promise a retirement income. Health insurance agents sell health insurance policies that cover the costs of medical care and loss of income due to illness or injury. They may also sell dental insurance and short- and long-term disability insurance policies.

An increasing number of insurance sales agents offer comprehensive financial planning services to their clients, such as retirement planning, estate planning, or assistance in setting up pension plans for businesses. As a result, many insurance agents are involved in 'cross-selling' or 'total account development.' Besides insurance, these agents may become licensed to sell mutual funds, variable annuities, and other securities. This is most common for life insurance agents who already sell annuities; however, property and casualty agents also sell financial products.

Technology has greatly impacted the insurance agency, making it much more efficient and giving the agent the ability to take on more clients. Agents' computers are now linked directly to the insurance companies via the Internet, making the tasks of obtaining price quotes and processing applications and service requests, faster and easier. Computers also allow agents to be better informed about new products that the insurance carriers may be offering.

The growth of the Internet in the insurance industry is gradually changing the relationship between the agent and client. In the past, agents devoted much of their time to marketing and selling products to new clients; however, this is changing. Increasingly, clients obtain insurance quotes from a company's website, then contact the company directly to purchase policies. This gives the client a more active role in selecting a policy at the best price, while reducing the amount of time agents spend actively seeking new clients. Because insurance sales agents also obtain many new accounts through referrals, it is important that agents maintain regular contact with their clients to ensure that their financial needs are being met. Developing a satisfied clientele who will recommend an agent's services to other potential customers is a key to success in this field. Increasing competition in the insurance industry means that carriers and agents must find new ways to keep their clients satisfied. One solution is the increasing use of call centers, which usually are accessible to clients 24 hours a day, 7 days a week. Insurance carriers and sales agents are hiring customer service representatives to handle the routine tasks such as answering questions, making policy changes, processing claims, and selling more products to clients. This opportunity to cross-sell new products to clients will help agents' business grow. The use of call centers also allows agents to concentrate their efforts on seeking out new clients and maintaining relationships with old ones.