How LIC Agents Earn Money? All You Should Know About Commission & Earnings!
LIC agents, often called insurance agents, play an important role in the Indian market. They can be considered a bridge between the insurer and the insured, bringing them together. There is a burning question “How do LIC agents earn money?” Knowing the earning potential of an LIC agent will help us understand why such a profession is an attractive career option for many.
In this comprehensive guide, we will explore how LIC agents earn money, what different sources of income are available, and how to increase their earnings. For top-notch financial advisory services, explore Ajay Gupta for expert and professional guidance.
Who Can Become An LIC Agent?
Although anyone in India can become an LIC agent, it is required to learn better about the eligibility criteria.
What is the Eligibility Criteria?
Any individual who is at least 18 years old & has successfully passed 10th grade is the minimum criteria to become an LIC agent. To learn more about the eligibility to become an LIC agent, Click Here.
Skills of A Good LIC Agent
A good LIC agent should have excellent communication skills with customers, should be capable of winning the confidence & trust of customers & very importantly, should be able to build relationships with customers.
Individuals who have a natural flair for sales & networking can easily succeed in this career, if not, can get trained very well to succeed in this career! There’s always a room for progress & upskilling.
The Bread and Butter of Income
The chief source of income for LIC agents is through commissions, which are earned every time they sell a policy. They generally receive a commission from LIC for each premium received by the policyholder upon selling a policy. A better break-up of commissions is as follows:
First Year Commission:
It is the biggest commission. It can run anywhere from 25% to 35% of the premium paid during the first year.
Renewal Commission:
In addition to the renewal commission for each successive year, the policyholder pays the premium, an agent is entitled to a renewal commission, which usually ranges between 5% to 7.5%.
Bonus Commission:
Apart from all the above-mentioned commissions, an LIC agent can earn bonuses, which depend on total sales as well as their overall performance for a fiscal year. The fact that it gives them a chance to increase their fixed monthly income for excellent performance and a long-term relationship with the client.
What Are The Different Sources of Income for LIC Agent?
We have outlined the key source of How LIC agents Earn Money
Direct Sales Commission:
These are incomes obtained through the sale of new insurance policies. When you sell every policy, you will earn the commission for that sale.
Renewal Commission:
The agents also continue earning income through the renewal of policies, creating the flow of a new source of income in a similar year.
Performance Bonuses:
Performance bonuses are rewarded to agents when they meet the respective targets or exceed them, thereby providing an attractive addition to how much money LIC agents make. Also additionally with foreign trips, luxury gifts, and special incentives added to the benefits, the appeal of becoming an LIC agent is great.
Refer the below chart for more detailed commission structure of LIC Agent
This table takes you through the detailed breakup of commission, an LIC agent will get for the type of premiums clients pay for.
| Policy Type | Premium Paying Term | First Year Commission | Second & Third Year Commission | Fourth Year Onwards Commission |
| Endowment Plans | 15 years and above | 25% | 7.50% | 5% |
| 10 years to 14 years | 20% | 7.50% | 5% | |
| 5 years to 9 years | 10% | 5% | 5% | |
| 2 years to 4 years | 5% | 2.25% | 2.25% | |
| Money Back Plans | As per Plan | 15% | 10% | 6% |
| 12 years | 15% | 8% | 6% | |
| Child Plans | 9 years and above | 10% | 5% | 5% |
| 5 years to 9 years | 7.50% | 5% | 5% | |
| 2 years to 4 years | 5% | 2% | 2% | |
| Pension Plans | More than 4 years | 7.50% | 2% | 2% |
| 2 years to 4 years | 5% | 2% | 2% | |
| Single Premium | 2% (Single Premium) | N/A | N/A |
Additional Insights about Commission for LIC Agents
- For any single premium plan, you’ll get a flat 2% commission for the paid premium by your client.
- Based on your performance, you will get other bonus & incentives annually.
Long-term Income Potential of LIC Agents
Perhaps the most attractive aspect of being a LIC agent is the lifetime income. The renewal commission means as long as clients pay their premiums, the agent will enjoy income passively. As more years pass and agents have a large enough portfolio, passive income can add up quite substantially.
Also, seasoned agents can move to leadership positions, managing other agents as well as mentoring and developing new agents, thereby opening up more avenues for direct or indirect income.
Other Benefits of Becoming An LIC Agent
Flexibility:
Work on any schedule, so that it is an ideal career for those who want work-life balance.
Recognition:
LIC provides ample opportunities for recognition nationally and internationally through rewards and awards to its representatives.
Growth Opportunities:
For good performance, agents have the chance to grow upwards in LIC and expand their liability which will increase their scope of earnings. Learn more about the benefits of Becoming LIC Agent here.
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Challenges in Earning Money
Like any profession, being an LIC agent has its drawbacks too:
Client Retention:
Client relationships and the renewal of policies provide long-term income. This is particularly tricky if the client is not being convinced or suffering financially.
Market competition:
The insurance market is very competitive, and agents have to sharpen their skills and strategy to be at the forefront.
Initial Struggles:
Most new agents have difficulty finding leads and closing sales. Experience and time levels are required to cross those initial struggles.
Real-Life Examples of Successful LIC Agents
There are numerous stories of LIC agents who have turned their careers into successful ventures:
Bharat Parekh:
One of the most successful LIC agents in India, Bharat Parekh built his career through persistent efforts and excellent client service. His earnings and reputation today serve as an inspiration to aspiring agents.
Ravi Jethani:
Another top LIC agent, Ravi Jethani, grew his network through trust and long-term relationships, demonstrating that dedication leads to success.
To know how they both succeeded with LIC, click here.
Maximizing Earnings as a LIC Agent
Tips for LIC agent to maximize their earnings
Maintain Healthy Client Relationship
Building a trustworthy rapport and maintaining long-term relations help ensure renewal and generate more referrals.
Grab Opportunity to Upsell or Cross-sell
Suggesting extra policies suitable for the client’s needs will help sell more policies.
Continuous learning
Staying updated on new policies and market trends helps agents better serve clients and sell more effectively.
Use Digital Tools
Digital tools can be utilized in the process of generating leads, managing clients, and follow-ups to tremendously leverage productivity sales.
Become an LIC Agent & Earn Money like Never Before!
Becoming an LIC agent provides a rewarding career with long-term, passive income potential. By leveraging direct sales, renewals, and performance bonuses, LIC agents can steadily grow their earnings.
If you’re exploring how LIC agents earn money and want a career that combines financial success with personal satisfaction, this profession could be life-changing. For expert financial services and guidance, trust Ajay Gupta to help you make informed decisions.
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