If you've ever purchased an insurance policy using a method other than the Internet, you've probably dealt with an insurance producer. As the name implies, a producer is responsible for "producing" sales for agencies, or for himself if he is self-employed. There several different types of insurance producers, including agents. However, not all licensed insurance agents are necessarily producers.
An insurance producer is a general term applied to anyone who engages in the sale of insurance products. Producers must be licensed by the state in which they wish to sell insurance. Most states require producers to pass an examination and meet any other educational and ethical requirements, which vary from state to state. Insurance producers may be agents or brokers, both of which usually consist of a separate set of licensing requirements.
An insurance agent is an individual appointed to represent a particular insurance company. An insurance agent may be a "captive," meaning her company prohibits her from representing other insurance carriers, or an independent agent who represents several companies, allowing for greater flexibility to meet client needs. Some companies may allow their captive agents to contract with other companies to sell non-competing lines of insurance that the company may not offer.
An insurance broker is a producer who operates much like an independent agent. Instead of representing only one insurance company, brokers may represent several different companies, allowing them to shop around for the best rates and coverage for their clients. Many states have slightly different licensing requirements for brokers than for agents and may require a higher level of insurance industry experience. A challenge of being a broker as opposed to an agent is that it can be difficult to keep up with the rules and policies of all the different companies they represent.
In some insurance agencies, an agent and producer may be distinguishable by the functions they perform. For instance, some agents may work as producers whose primary role is to solicit new policyholders and help the agency grow. Others may work as customer service representatives, who provide assistance to existing policyholders. Depending on the laws of their state, CSRs may be required to possess an agent's license since they engage in insurance transactions with policyholders.
Insurance sales agents earned a median annual salary of $49,990 in 2016, according to the U.S. Bureau of Labor Statistics. On the low end, insurance sales agents earned a 25th percentile salary of $35,500, meaning 75 percent earned more than this amount. The 75th percentile salary is $77,140, meaning 25 percent earn more. In 2016, 501,400 people were employed in the U.S. as insurance sales agents.