How lic agent earn money
The Life Insurance Corporation of India (LIC) is one of the largest insurance companies in India which provides a wide range of life insurance policies to millions of individuals. Many people in india works as a LIC agent and play a crucial role in the company’s success by promoting and selling these policies. In various ways a LIC agents earn money, including commissions, bonuses, and other incentives by completing some target.
1. Commission Structure of lic agents
Most of the earning of lic agents totally based on commission , it is like the more policies they can sell the more they will earn . And you might have noticed that some lic agents are earning a lot while at the same time ithers don’t .It forms the foundation of an LIC agent’s earnings. It totally depends on what kind of policy they are selling influence commission percentages, such as the type of policy and the premium payment term. By providing examples and real-life scenarios, we will offer a comprehensive understanding of how commissions work for LIC agents.
2. First-Year Commission
The first year of a policy is crucial for LIC agents as they earn The most higher commission percentage during this period.
why first-year commissions are higher
• The first year of a policy is crucial for LIC agents because during this time they have the opportunity to earn a higher commission percentage compared to next years This higher commission rate serves as a significant source of income for agents.
• In first year , LIC agents have the chance to build a strong customer base and establish a steady stream of renewal commissions. By offering a higher commission rate in the first year, LIC motivates the agents to focus on acquiring new customers and generating sales.
• In first year if they get success in Building a strong customer base Then, it will lead to the foundation for future renewal commissions. If policyholders renew their policies in subsequent years, agents can continue to earn commissions from those renewals. Therefore, the first-year commission not only provides immediate income but also has A long-term benefit. .
These are the rate of commision
• Money Back plan: 20%
• Term Plan: 25%
• New Endowment plan: 25%• Pension Plan: 2%
• Child Plans: 25%
Health Insurance Plan: 25%
Endowment plans
| Premium tenure | Comission for the first year | commission for 2nd year and 3rd year | Commission from 4 year onwards |
|---|---|---|---|
| 15 years or above | 25% | 7.5% | 5% |
| 10 years to 14 years | 20% | 7.5% | 5% |
| 5 years to 9 years | 10% | 5% | 5% |
| 2 years to 4 years | 5% | 2.25% | 2.25% |
Money back plans
| Premium paying tenure | commission on 1st year | commission on 2nd and 3rd year | commission from 4th year onwards |
|---|---|---|---|
| As per plans | 15% | 10% | 6% |
| 12 years | 15% | 8% | 6% |
Child plans
| Premium paying tenure | commission for 1st year | commission from 2nd year onwards |
|---|---|---|
| 9 years and above | 10% | 5% |
| 5 years to 9 years | 7.5% | 5% |
| 2 years to 4 years | 5% | 2% |
Pension plans
| Premium paying tenure | commission for 1st year | commission fron 2nd year onwards |
|---|---|---|
| More than 4 years | 7.5% | 2% |
| 2 to 4 years | 5% | 2% |
NOTE: ALL COMMISIONS ARE CALCULATED ON AMOUNT OF PREMIUM PAID
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3: Renewal Commission
Renewal commissions is an essential source of income for LIC agents.
• agents earn renewal commissions for policies that are renewed by policyholders.
Whenever , Any of the existing policy holder nenews his policy , some portion of it as commission goes to the agent who has sold that policy. This varies from policy to policy.
• We will explore the renewal commission structure, which is usually a percentage of the premium paid in subsequent years. By discussing the significance of policy renewals and persistency rates, we will shed light on the long-term financial benefits for LIC agents.
4.Bonuses and Incentives
• Apart from commissions, LIC agents have the opportunity to earn various bonuses based on their performance.
• the different types of bonuses available to agents. These includes persistency bonuses for maintaining a certain level of policy renewals, club membership bonuses for achieving specific sales targets, and other performance-based incentives.
5. Factors Affecting Earnings
• how sales skills, the number and type of policies sold.
The thing which matters the most in selling policy is your skill, ability to convince people if you have these you will definitely achieve success in this field.
• and the persistency of policy renewals play a crucial role in determining an agent’s income. Additionally, we will highlight the importance of building a strong client base and maintaining good customer relationships to ensure a steady stream of income.
LIC agents earn money through a combination of commissions, bonuses, and incentives. By exploring the commission structure, first-year commissions, renewal commissions, and various bonuses.. It is evident that an LIC agent’s income is directly linked to their ability to generate sales.
How to become a lic agent
To become a LIC agent, you need to follow these steps:
1. Must fulfil the eligibility criteria
You must be at least 18 years old and have completed your 10th standard education.
2. Find a Development Officer Near you
You have to Contact a Development Officer (DO) from your local LIC branch. He will guide you through the process and provide you with the necessary information and documents.
3. Attend pre-licensing training
After this you have to Enroll in the Pre-Licensing Education Program (PLEP) conducted by the Insurance Institute of India . This program consists of 50 hours of training which covers topics such as insurance products, sales techniques, and regulations.
4. Pass the Pre-Licensing Examination
After completing the PLEP, you must pass the Pre-Licensing Examination . The exam assesses your knowledge of insurance concepts and regulations.
5. Submit the application
Then, Fill out the LIC Agent Application Form provided by the DO. Attach the required documents, such as your educational certificates, age proof, address proof, and photographs.
6. Background verification
LIC will conduct a background check to ensure your suitability for the role of an agent. This may include verifying your character, reputation, and financial stability.
7. Obtain a license
When your application gets approved, you will receive a license from LIC to work as LIC agent.
8. Complete the practical training
Undergo practical training at the Divisional/DO’s office to gain hands-on experience in selling insurance policies and understanding customer needs.
9. Start selling policies
After completing these steps you are all set to start selling LIC policies to customers. Use your training and knowledge to effectively communicate the benefits of LIC products and help customers choose policy according to their demand
10. Maintain ongoing training
Keep yourself updated with the latest insurance products, industry trends, and sales techniques through ongoing training programs provided by LIC or other relevant institutions.
Remember that becoming a successful LIC agent requires dedication, hard work, and good communication skills. Building a strong customer base and consistently meeting sales targets will help you establish a successful career in the insurance industry.
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Frequently asked question related to about how lic agent earn money
1.who is the richest lic agent.
Parekh is the richest lic agent with a per month income 400 crore. Interesting fact is that he earns more than lic chairman . About 5 times more than him.
2. How much lic agent can earn per month
There is no limit ,It depends on no. Of sale if you can sell multiple policies you can earn 1 lakh . But overall average is around 20000 per month
3.is lic agent a good part time job.
Yes it is a good option you can earn a good amount by doing only 2-3 hours of work per day . One can also take it as full time if you have capability to convince people.
4.how are lic agents are paid.
Payments are done on commission basis , the more you sell the more you will get .
