Are you considering becoming a Life Insurance Corporation (LIC) Merchant Agent? You may be wondering how much commission do LIC agents get for the policy they close. Do they get paid based on the type of plan and/or other criteria? What if renewed policies are involved in deals?
Agents do, however, get paid a commission for the insurance they offer. A commission of 25% to 35% is offered by LIC on the policy premium for the first year, followed by 7.5% for the second and third years, and 5% till the policy’s maturity.
It’s important to note that commissions are not guaranteed in any way and can change from time to time as per company discretion or when there is a revision in commission structure by Insurance Regulatory & Development Authority (IRDA).
Ultimately, commission depends on LIC’s agreement with its advisor, but you can be sure that your LIC Agent will always have your best interests in mind when recommending a policy for purchase.
All You Need To Know: How Much Commission Do LIC Agents Get For The Policy
India’s state-owned insurance firm is called Life Insurance Corporation of India, or LIC. With assets of more than Rs 2 trillion (US$31 billion), it is one of the biggest life insurers in the world.
With more than 17 million agents spread out across India, LIC provides a wide range of insurance products to its clients. Now, we will take a look at how much commission LIC agents get for selling different types of policies.
LIC agents earn a commission for each policy sold, depending on the type of policy and its premium amounts. For example, LIC agents can earn up to 25% commission for single premium policies and up to 15% for regular premium policies. Besides, they will also earn additional incentives based on their performance.
For term insurance plans, LIC agents get a flat rate of 5-7% commission on the total amount of annual premiums collected from the customer over the course of the plan (not including GST).
Endowment Policies are also popular among customers due to their added benefits like bonuses and profits at maturity. LIC’s endowment insurance plans offer attractive commissions to agents as well – ranging between 6-10%. However, the commission amount may also vary according to the plan and its premium.
ULIPs are unit-linked insurance plans, which offer customers life cover along with a market-linked return on their investments. Agents tend to earn higher commissions for selling ULIPs as compared to other policies. They get between 7-12% of the total premiums collected by LIC over the course of the policy term.
Overall, Life Insurance Corporation of India offers lucrative commissions and incentives to its agents, which helps them in building a successful career in life insurance. The commission rates are based on various factors such as the type of policy, premium amounts, the performance of the agent, and so on. This makes it easier for agents to understand how much they can earn from different policies.
By offering attractive commissions, LIC has managed to attract more agents and make its presence felt in the Indian insurance market. It has also enabled many agents to build successful careers in life insurance by providing them with an incentive-based structure.
Factors You Should Consider While Buying Life Insurance
Selecting the right life insurance policy for yourself and/or your family can be an intimidating task. An important first step is determining your financial needs and objectives, as this will allow you to determine which type of life insurance you may need.
To best decide the policy that meets your needs, consider factors such as eligibility requirements, premium costs, death benefits, living benefits, term lengths, and riders. Eligibility requirements will inform you of who may qualify for coverage.
Premium costs define the amount that must be paid each month or other designated time period to remain covered by the policy. They also have to pay premium through LIC Merchant Portal. Death benefits are payments made upon the death of the insured individual that can go to designated heirs.
Living benefits refer to cash withdrawals available before policy maturity when certain contractual criteria are met. The term length will help establish how long coverage is needed.
Any riders give greater flexibility beyond standard life insurance policies, allowing policyholders to further customize their coverage to fit their needs. Thinking about these various factors before purchasing a life insurance policy can ensure finding an option that fits your budget and lifestyle.
In the end, it is important to keep in mind that each LIC policy is different and so are the commissions. It really all comes down to what you as the agent are comfortable with and what works best for you and your company.
There may be some trial and error involved, but eventually, you will find a commission plan that fits both your and your client’s needs while providing adequate coverage.