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How to hire an Insurance Agent

Insurance agents sell life and general insurance policies. They find out what each client needs and explain how the products work. They manage renewals and keep policies from lapsing. Companies hire many agents, and many quit. Agents who build trust and explain products simply sell more than agents who use fear or pressure.

Screen Insurance Agent applicants
Insurance Agent

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What is an Insurance Agent?

An Insurance Agent sells life, health, or general insurance to people and businesses for an insurer. They work out what cover each person really needs. They explain how a policy pays out and what it leaves out. They fill in the underwriting forms honestly. They keep the policy going through renewals. Agents earn commission on new premium. They also earn a trailing commission, but only while the policy stays in force. That is why insurers care more about persistency than first-year sales.

Also called
Insurance Advisor, Insurance Consultant, Policy Advisor
Function
Insurance distribution and sales
Level
Entry to experienced, individual contributor, often self-employed
Represents
One insurer (tied agent) or several (multi-tied or broker)
Measured on
New business premium, policy count, persistency ratio, complaints
Next step
Agency Manager, Development Officer, or an independent advisory practice

The hiring challenge

Many insurance agents quit early because companies hire for enthusiasm and ignore selling skill. A candidate may be excited about "unlimited earnings". If they cannot explain how term life differs from whole life, they will likely leave within six months. The real test is a genuine needs analysis. Does the candidate ask about income, family, current cover, and goals before suggesting a product? Or do they push the policy that pays the highest commission? Persistency ratio matters more than first-year premium. Policies that lapse cost the company money.

What to look for in an Insurance Agent

Four traits predict success in insurance sales. Selling based on needs: do they start with the client's situation or with the brochure? Product knowledge: can they explain term life, whole life, annuities and health insurance in simple words? Handling objections: insurance objections are personal. Clients say "I do not believe in insurance", "I am too young", or "I already have cover from work". Can the candidate answer without getting defensive? Thinking about persistency: do they stay in touch after the sale to help with renewals? Or do they disappear after the first premium?

Also test three more things. First, the basic rules in your market, such as licensing, free-look or cooling-off periods, and policy servicing rules. Second, ease explaining insurance in the client's language. Insurance talks need trust, and trust is easier in the client's first language. Third, honest selling. Mis-selling is a known problem in the industry. The best agents stand out because they recommend what the client needs. The product that pays them the most comes second.

Listen to how candidates describe their clients. Strong candidates talk about specific needs they worked out. One might be a young couple planning for a child. Another might be a business owner who needs keyman insurance, or a retiree who needs health cover. Weak candidates talk about "targets" and "premiums collected" and never mention a client.

Common mistakes when hiring Insurance Agents

Hiring on motivation alone. Every insurance candidate says they are "motivated" and "hardworking". Motivation without product knowledge and selling skill leads to mis-selling or early quitting. Test if they can run a needs conversation. Do not stop at how eager they seem.

Ignoring persistency. Ask for their persistency ratio. What share of their policies renewed in the second year? Low persistency means they sold to people who did not need or understand the product. High first-year premium with low persistency is a loss for the company.

Not testing their ethics. Give them a scenario where a client wants a product that does not suit them. One example is a low-income family being sold a high-premium whole life policy. Their answer tells you if they will protect the company's name or create legal risk.

Key skills for an Insurance Agent

  • Needs-based selling and discovery
  • Product knowledge (term, whole life, annuities, health)
  • Objection handling and resilience
  • Insurance regulatory awareness
  • Persistency and renewal management
  • Vernacular client communication
  • Trust-building and ethical selling
  • Field sales and self-management

What a great interview looks like

Roleplay

"A 30-year-old salaried worker has a spouse and one child. They say they want to "invest in insurance". Find out what they need and suggest a product."

Voice

"A prospect says, "Insurance is a waste of money. I would rather invest in mutual funds." How do you respond?"

MCQ

"A client wants to cancel a policy during the free-look period. Which of these statements about the process is correct?"

Scenario

"Your agency manager tells you to sell whole life policies to low-income clients because the commission is higher. What do you do?"

Voice

"Explain how term life insurance differs from whole life insurance. Explain it as if I have never heard of insurance before."

You can use these questions in Goodfit as they are, or edit the questions and the scoring for your team.

See all 14 Insurance Agent Interview Questions and Answers

Recommended interview process

  1. 1

    Round 1: AI Voice Interview15 to 20 min

    A needs-analysis roleplay with a client profile, product knowledge questions, and objection handling. Scored on the quality of their questions and on honest selling.

  2. 2

    Round 2: Product Knowledge Test20 min

    Multiple-choice and scenario questions on term life, whole life, annuities and health insurance, plus the basic rules.

  3. 3

    Round 3: Agency Manager Interview30 min

    A talk about their persistency record, readiness for field work, and territory planning.

In Goodfit, the AI interview runs the first round for every applicant. Skill tests, coding tests and roleplays can run in Goodfit too. Your team reads the scorecards and joins for the later conversations.

FAQ

Insurance Agent hiring questions

What does an insurance agent do?
An insurance agent finds prospects. They talk with each one to work out the right cover and sum assured. They suggest a product and explain its features, exclusions, and charges. They help fill in the proposal and the medical or underwriting forms. Then they service the policy. That means renewal reminders, changes to nominees or cover, and help when there is a claim. Much of an experienced agent's income comes from renewals on policies sold years before.
What is the difference between an insurance agent and an insurance broker?
An agent works for the insurer. A tied agent sells one insurer's products and answers to that insurer. A broker works for the customer and has a separate license. A broker can compare products from many insurers. They must recommend what suits the client, even if the insurer wants to sell something else. For a buyer, the difference is the range of products and whose side the person is legally on.
What is the difference between an insurance agent and a financial advisor?
An insurance agent is licensed to sell insurance. A financial advisor or planner looks at the bigger picture. That includes investments, retirement, tax, and protection. In most markets they need separate qualifications to advise on investment products. Many people do both. They hold an insurance license and investment certifications. That is the usual way out of pure agency work.
How do insurance agents get paid?
They earn commission in two parts. The first is a first-year commission on new premium. It is the larger amount, and recruiters talk about it most. The second is a renewal or trailing commission, paid each year the policy stays in force. Rates differ by product and market. Long-term life products pay more first-year commission than motor or health. Renewals add up over time. By year five, an agent's income depends much more on policies from years one to three staying alive than on new sales.
What is a persistency ratio and why does it matter?
Persistency is the share of policies still in force after a set time. It is usually measured at 13 months, 25 months, and so on. It is the clearest way to see if an agent sold the right cover. Low persistency means the agent talked people into policies they could not keep paying for. A lapsed policy costs the insurer what it spent to win the customer. The customer is left with nothing. So more insurers now tie agent rewards, promotions, and contract renewals to persistency. First-year premium alone no longer decides it.
What license or qualification do you need to become an insurance agent?
Every major market requires a license. Agents take a set training course and pass an exam. They register with the regulator or through an insurer that sponsors them. They renew the license from time to time and keep up with training. The schooling needed is usually modest, often just secondary school. That is why the job is a common way into financial services. Selling without a valid license puts both the agent and the insurer at risk.
What skills make a good insurance agent?
First, they can run a real needs analysis. They ask about income, dependents, current cover, debts, and goals before naming a product. Second, they can explain a complex product in plain words, including what it does not cover. Third, they bounce back from rejection, because most people say no. Fourth, they follow through on renewals and claims. That is where reputation and referrals come from. Fifth, they sell honestly, since the product that pays the most is rarely the one that suits the client best.
Why is attrition among insurance agents so high?
Recruiters pick people for enthusiasm, but the job needs skill. Agents are often hired with a pitch about unlimited earnings. They sell to friends and family for a few months. Then they run out of people they know. They leave before they learn to find prospects or explain products well. The agents who last could explain term life versus whole life at interview. Being the most excited about the money did not predict who stayed.
What interview questions should I ask an insurance agent?
Ask them to explain term life versus whole life insurance to someone with no finance background. This quickly shows who is a real advisor and who just reads the brochure. Give them a client profile. Ask what they would suggest and why. Ask what they would do if a client wants a product that does not suit them. Ask what their persistency was, then ask how they know.
How do you hire insurance agents at volume?
Because so many agents quit, screening should predict who will keep policies alive. Enthusiasm is a poor guide. A structured voice first round puts every candidate through the same needs-analysis roleplay. Each one also explains the same product. They are scored on the quality of their questions and their accuracy. They are also scored on whether they push an unsuitable product under target pressure. This predicts who will still be selling in month twelve. How motivated they sounded does not.

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