How Much Do Insurance Agents Make? Salary, Commissions, and Pay by State

Insurance sales agents earned a median of $62,280 per year in May 2025, according to the U.S. Bureau of Labor Statistics (BLS), with the lowest-earning 10% making less than $37,330 and the highest 10% earning more than $138,140. How much an insurance agent makes depends less on location than on the products sold, the commission structure, and whether the agent works for one company or independently. This guide explains how insurance agent pay works across the country, how commissions are set, what life agents, brokers, and agency owners earn, and where the numbers differ by state.

How much do insurance agents make?

The median annual wage for insurance sales agents was $62,280 in May 2025, above the $50,980 median for all U.S. occupations, according to the BLS Occupational Outlook Handbook^[1]. The lowest 10% of agents earned less than $37,330, and the highest 10% earned more than $138,140.

The spread between those figures is wide because commission income has no ceiling. A small number of very high earners pull the average wage well above the median, so the median is the better guide to typical pay. The CareerOneStop wage profile^[2] shows the full distribution from May 2025 federal wage data:

One limit on these figures matters for anyone comparing offers: the federal wage data exclude self-employed workers and owners of unincorporated businesses, per the BLS description of its wage source^[1]. Many independent agency owners, who often sit at the top of the earnings range, are outside these numbers entirely.

Agents hold a producer license, the credential state insurance departments issue, and licensing runs state by state. The two main tracks, one covering life and health products and one covering property and casualty products, are licensed separately, so the line an agent sells shapes the commission structure from the first day.

How insurance agents are paid

Most agents earn a commission on each policy they sell, and commissions are the most common form of compensation, especially for experienced agents, according to the BLS Occupational Outlook Handbook^[1]. Employee agents at an agency or carrier may instead be paid a salary only, a salary plus commission, or a salary plus a production bonus. Independent agents may work on commission alone, with no salary underneath.

A commission is a share of the policy premium, set by the insurer rather than the agent. The rate depends on the product, the amount of coverage, and whether the sale is a new policy or a renewal. First-year commissions are usually the largest payment, with smaller commissions each year the policy renews. The insurer pays the commission, so the customer does not pay the agent separately, and an agent does not lose money when a client files a claim.

Beyond base commissions, some carriers pay supplemental or contingent commissions as incentives for hitting business targets, and some run profit-sharing programs that reward agencies for meeting revenue or retention goals. These bonus layers matter more to experienced agents and agency owners than to new licensees.

Commission rates by insurance product

Commission rates differ sharply by product, and the differences shape an agent's whole income pattern. Auto and home policies pay a modest share of the premium upfront and a smaller share at each renewal, so income builds gradually as the book of business grows. Health policies sit in a similar middle band. Life insurance pays the opposite way: most of the commission arrives in the first year, and later years pay little.

Medicare Advantage is the one product with a published national rate. Under 42 CFR 422.2274^[3], federal rules cap agent compensation for a Medicare Advantage enrollment at a fair market value benchmark: $539 nationally and $672 in California and New Jersey. For contract years beginning with 2025, renewal-year compensation must be paid at 50% of the benchmark.

Life insurance also carries a chargeback risk. If a policy lapses in its first years, the insurer can require the agent to repay part or all of the commission. Because premiums and commission schedules differ by line, the choice of license shapes both yearly income and how it builds over time: property and casualty policies renew year after year at a steady, smaller rate, while life policies pay mostly upfront.

Captive agents versus independent agents

A captive agent represents one insurance company and usually earns a salary or a salary plus a lower commission rate. An independent agent represents several companies, earns higher commission rates, and covers the agent's own business expenses. The trade-off is security versus upside.

Captive agents receive training, marketing support, and often a base salary, in exchange for lower commission rates and a book of business the carrier controls. Independent agents take higher rates and build a book they can keep or sell, but they fund their own startup and operating costs, and a new independent agency often runs at a loss for the first years until renewal income builds. Crowd-sourced estimates for independent agent earnings span roughly $65,000 to $90,000 on average, a wide enough spread to show how much performance and market drive results.

State Farm, the country's largest property and casualty insurer, is the best-known captive channel. State Farm does not disclose what its agents earn, and published estimates vary widely, but gathered figures place typical State Farm agent pay below the national median for insurance sales agents, with the top performers well above it. Allstate and Farmers run comparable captive models with the same pattern: a base plus incentives, with the carrier setting the rates.

Life insurance agent earnings

Federal wage data does not separate life agents from the wider occupation, so no life-only median exists. Salary-site estimates for life agents vary widely by source and by year, which is why the federal figure for the occupation as a whole is the more reliable benchmark.

Life agent pay is heavily front-loaded. Renewals pay only a small fraction of the first-year commission, and some carriers have stopped paying renewal commissions on term products entirely. Permanent products such as whole life carry larger premiums and larger first-year commissions than term, which raises income per sale even at similar effort. Steady new sales, not a maturing book, drive most of a life agent's yearly income.

What insurance brokers earn

No federal wage series separates brokers from agents, so the same national figures cover both roles. A broker represents the person buying coverage rather than the insurer, and broker pay follows the same commission model: a share of the annual premium, commonly a few percentage points, with a larger share in the first year and a smaller ongoing residual. Private salary estimates for brokers cluster in the mid-$70,000s to mid-$90,000s, in line with agent pay, since the federal data never splits the two.

Brokers can also earn fees for work beyond placing a policy, such as consultative or claims-filing services, where state rules allow it. A National Association of Insurance Commissioners chart of state rules^[4] tracks which states permit producer fees, and most require a written agreement and disclosure to the client.

Agency owner income

An agency owner earns commission on every policy the agency writes, so owner income is the agency's commission stream minus its expenses, not a salary. Gross revenue is not take-home pay, and the mix of lines the agency writes drives the top line; expenses such as staff and rent come out before the owner earns anything.

Where insurance agents earn the most

State medians for insurance sales agents run from $45,180 in New Mexico to $84,530 in the District of Columbia, according to BLS OEWS May 2025 state data^[5]. New Jersey, Rhode Island, and Wisconsin follow the District of Columbia at the top of the range. The table below compares median pay in six large states.

Source: BLS OEWS, insurance sales agents, May 2025 state estimates.

Florida employs the most agents of any state, at 47,560, just ahead of Texas, per the same May 2025 estimates. A high nominal median does not always buy more once local prices are taken into account, so agents comparing markets should weigh pay against cost of living.

Job outlook for insurance sales agents

Employment of insurance sales agents is projected to grow 3% from 2025 to 2035, about as fast as the average for all occupations, with about 43,100 openings per year, most from workers leaving the occupation, per the BLS Employment Projections^[1]. Agents held about 572,600 jobs in 2025; 63% worked in insurance agencies and brokerages, and 12% were self-employed. The BLS expects growth to be strongest for self-employed agents, with online direct purchase holding demand down somewhat even as the need for advice keeps the role in place.

For scale, the National Insurance Producer Registry (NIPR) held 9.2 million producer records in its database in 2025, a 2.2% increase over 2024, according to the NIPR 2025 annual report^[6]. That count includes multiple licenses per person and licensees no longer selling, so it far exceeds the number of practicing agents.

Getting started: from license to first commission

Every dollar of agent income starts with a state producer license, and the typical entry-level education for the occupation is a high school diploma, not a college degree, per the BLS Occupational Outlook Handbook^[1]. A license is required in each state where the agent sells, and the two main tracks, life and health and property and casualty, unlock different commission structures. RealEstateU offers state-approved prelicensing courses for both tracks, built around the material state exams cover.

Before committing, decide which lines to sell and check the licensing rules in your state, since prelicensing hour requirements and exam vendors differ from state to state. Plan your budget around a lean first year or two, since most of a new agent's income arrives with new sales rather than renewals. Agents who combine lines, or who add nonresident licenses to sell across state lines, widen the pool of policies they can earn from.