How much do insurance agents make?
The short answer
Independent insurance agents typically earn between $40,000 and $150,000+ per year, with top performers exceeding $300,000. But that range is almost useless without context. Your income depends on whether you are captive or independent, how many years you have been in the business, what lines you write, how many carriers you have, and where you operate. This guide breaks it all down with real numbers.
Income by experience level
What to realistically expect
Year 1: $20,000 - $45,000. You are building from zero. Every client is new. Renewal income does not exist yet. Most agents supplement with savings or a part-time income source during this phase.
Years 2-3: $45,000 - $80,000. Renewal commissions from year one start compounding. Referrals begin flowing. You hit your stride with quoting and closing.
Years 4-5: $80,000 - $120,000. Your book is generating meaningful passive renewal income. New business stacks on top. This is where the independent model starts outpacing captive.
Years 5-10: $120,000 - $250,000+. Agents who retain clients well and keep writing new business consistently land here. Your book is now worth 1.5-2.5x annual revenue as a sellable asset.
10+ years: $200,000 - $400,000+. Top independent agents with $3M+ in managed premium. Some build agencies with producers and multiply further.
Captive vs. independent income
Captive agents (State Farm, Allstate, Farmers) typically start with a base salary of $30,000-$50,000 plus benefits, with commission on top. Total year-one compensation is usually $40,000-$60,000. The ceiling is lower because commission rates are lower (5-10% vs 10-15%) and the carrier owns your book.
Independent agents start with zero base salary and zero benefits. Year-one income is lower. But by year 3-5, independent agents almost always earn more because commission rates are higher, renewal income compounds faster, and the book becomes a sellable asset. Read our full captive vs independent comparison.
Income by line of business
Commission rates by product type
Personal auto: 10-13% new, 8-11% renewal. High volume, low margin. You need a lot of policies to make meaningful income from auto alone.
Homeowners: 12-15% new, 10-12% renewal. Higher premiums than auto mean more dollars per policy.
Commercial (BOP/GL): 12-15% new, 10-12% renewal. Higher premiums and stickier clients. A $10,000 BOP policy at 14% = $1,400 per year in commission.
Workers comp: 7-10% new, 5-8% renewal. Lowest P&C commission but large premium accounts can make up for the lower rate.
Specialty (cyber, D&O, professional liability): 15-20% new, 12-15% renewal. Highest rates because expertise is required to sell these products.
Life insurance: 30-120% first year, 2-5% renewal. Front-loaded income. First-year commissions are enormous but renewals are small.
The takeaway: agents who diversify into commercial and specialty lines earn significantly more than agents who only write personal auto. A balanced book with personal lines for volume and commercial lines for premium generates the strongest income.
The math on a real book
Here is a concrete example. An independent agent with a $1.5M book of business (total managed premium across all carriers), writing 60% personal lines and 40% commercial, with an average commission of 12%:
Example: $1.5M book breakdown
Annual commission income: $1,500,000 × 12% = $180,000
If through aggregator (3% override): $1,500,000 × 9% = $135,000
Book valuation (1.8x multiplier): $180,000 × 1.8 = $324,000 sellable asset
Year-over-year growth at 15% retention + new biz: Income grows each year as renewals compound
What affects your income most
Retention rate. Keeping clients is worth more than finding new ones. An agent who retains 90% of clients earns dramatically more over 5 years than one who retains 80%. Every lost client is lost renewal income forever.
Number of carriers. More carriers means more quoting options, higher close rates, and better client fit. Agents with 8-12 carriers close more business than agents with 3-4.
Commercial vs personal mix. Shifting even 20% of your book from personal to commercial lines can increase income by 30-50% because premiums and commission rates are both higher.
Geography. Agents in high-premium states (coastal Florida, California, Texas metro areas) earn more per policy simply because premiums are higher. A homeowners policy in Miami might generate 3x the commission of the same coverage in rural Iowa.
See real commission rates by carrier
Agent-reported commission data for 59 carriers across every major line of business.
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