Well, let’s dive into the attrition rates among agents and discover the primary reason behind this trend.
Take a look at this graph.
The numbers are quite eye-opening!
It shows that a significant portion, around 90-95%, of agents make the decision to move on within the first year.
Out of that group, about 11% bid farewell within the first three months, while an additional 19% choose to leave within three to six months.
So, what drives this high turnover rate?
It all comes down to the pressure of meeting sales targets.
Agents often find themselves grappling with demanding expectations, which can lead to a sense of uncertainty about the stability of their job.
It’s certainly a tough challenge to tackle!
Speaking from my own experience as a life insurance agent, let me share my journey with you.
Well, let me take you back to 2018, when I made a leap of faith and embarked on a journey to become a licensed life insurance agent.
At the time, I was searching for a flexible way to earn extra income and perhaps even involve my husband in a side business.
With a background in finance, it seemed like the perfect opportunity to provide financial education while benefiting from high commission rates.
After successfully passing the state test and obtaining my license, the future appeared promising.
However, a stark reality loomed over me: around 90% of life insurance agents quit within their first year.
Determined not to become just another statistic, I poured my heart and soul into making life insurance a success for myself.
I fought tirelessly to establish my career in life insurance industry.
Yet, despite my unwavering efforts, I decided to quit a little over a year later. And let me tell you why.
Throughout my journey, I encountered numerous challenges and eye-opening experiences that ultimately led to my departure.
It wasn’t an easy decision, but looking back, I know it was the right one.
In the upcoming sections, I will share with you the reasons behind my choice to leave the life insurance agent profession.
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The Truth About Being A Life Insurance Agent Through An MLM
Well, I have a unique story that I’m excited to share with you.
Unlike most people who become insurance agents after attending a seminar or answering a job ad, I stumbled into this career path quite unexpectedly.
It all started when I joined a local women’s business networking group back in 2016.
During one of our meetings, I hit it off with a woman who was also in the group.
We met for coffee, and what was meant to be a quick chat turned into a four-hour conversation.
Little did I know that this meeting would change the course of my career.
As we chatted, the woman mentioned that she was part of an MLM that provided financial education to clients. Curious, my husband and I attended an information meeting at her office.
There, we learned about the power of life insurance, not just for protecting your loved ones but also for building wealth.
Suddenly, my negative views about whole life insurance policies faded away, and I saw the opportunity.
We paid a small fee of $150 to sign up as independent life insurance agents through the company.
This fee covered the app we would use to track our earnings and the training resources we needed to get licensed through the state.
Now, I was ready to start working under the woman who had invited me to join her business, my ‘upline.’ Little did I know what was in store for me as a life insurance agent working through an MLM.
So, buckle up and let me share with you the truth about what it’s really like to be a life insurance agent in this unique setting.
How MLMs Actually Work?
Multi-level marketing companies, commonly known as MLMs, operate through a direct sales strategy, where independent sales agents like myself can sell a product or service and earn a commission. Sounds enticing, right?
Well, MLMs also have another aspect to them.
They heavily emphasize recruiting others to join your team and sell products as well.
This way, you not only earn commissions from your own sales but also receive a portion of the commissions from your recruits.
It’s like building a network of sellers beneath you, forming multiple levels or tiers.
Now, you might be familiar with MLMs yourself, either through personal experience or knowing someone involved in one.
They can be quite pervasive, and it’s not uncommon to have a friend or family member who has tried their hand at MLMs.
However, despite the initial excitement and potential for earning income, many people end up quitting these ventures, just like life insurance agents.
One of the reasons MLMs often get associated with pyramid schemes is because the structure of MLMs resembles a pyramid.
In a pyramid scheme, the focus is primarily on recruiting new members, with little emphasis on actual product sales.
The few individuals at the top of the pyramid benefit the most, while the majority of participants struggle to make substantial earnings.
This is where the saying “faking it until they make it” comes into play, implying that most people within the MLM strive for success but often fall short.
For me, combining the challenges of being a life insurance agent with the complexities of an MLM was a risky move.
It became clear that the MLM aspect of my work was overshadowing my ability to genuinely help people with their life insurance needs.
I felt pressured to recruit others and focus on building my network rather than providing the best service and products to my clients.
Ultimately, I decided to step away from being a life insurance agent and disassociate myself from MLMs.
While the concept of MLMs might sound appealing initially, it’s important to approach them cautiously and carefully consider the potential risks involved.
Let me tell you why being a life insurance agent was a great experience for me, even though it was for a short period of time!
1. Making A Difference
One of the things I absolutely loved about being a life insurance agent was the opportunity to help others.
I’ve always been passionate about personal finance and guiding people towards smart financial decisions.
Sitting down with individuals and explaining the benefits of life insurance while helping them explore different options was truly rewarding.
2. Incredible Support
From day one, I felt a strong sense of camaraderie and mentorship within our office.
Witnessing everyone building their businesses and supporting each other was incredibly inspiring.
Whenever I had questions or needed guidance, I knew I could rely on my upline for assistance and direction.
It’s the kind of supportive environment that helps you thrive.
3. Continuous Training Opportunities
One of the great things about the company I worked with was their emphasis on training.
We had two weekly training sessions that the whole office would attend, along with longer, more in-depth training sessions on Saturdays a few times a month.
Mastering the complexities of life insurance requires continuous learning, and these opportunities allowed us to become experts in our field.
4. A Mindset Of Growth
Sales can be tough.
Rejection and self-doubt are common, but being a life insurance agent pushed me to improve my mindset.
I learned to face those challenges head-on, pushing past negativity and striving for breakthroughs.
Personal development and hard work were key ingredients for success in this field, and I embraced the opportunity to grow both personally and professionally.
Being a life insurance agent was an incredible journey filled with purpose, support, and constant self-improvement.
However, some aspects didn’t align with my expectations and circumstances.
(1) The Commission Conundrum
One aspect that posed a challenge was the commission structure.
To earn a substantial income, you need to sell numerous life insurance policies, preferably with higher premiums.
While smaller policies were manageable, relying solely on them wouldn’t lead to a sustainable career.
The reality was that making a decent living required significant sales efforts.
Balancing this financial pressure with my existing writing business became overwhelming.
(2) The Cold Calling Saga
If you’re not a fan of sales or the idea of cold calling, life insurance might not be your ideal fit.
Personally, I had a previous unpleasant experience at a call centre, where I had to prioritize my mental well-being and walk away from the job.
Once I exhausted my list of friends and family, I had to venture into prospecting territory.
As an introvert, it felt peculiar to transform everyday activities like grocery shopping or attending social gatherings into opportunities to meet potential life insurance clients.
(3) The Team Building Tussle
In retrospect, I discovered that I genuinely prefer remote work and working independently.
The pressure to build a team alongside finding clients added an extra layer of responsibility. Shortly after obtaining my license, my upline team urged me to recruit guests from our housewarming party to join the company under me.
However, I found myself dreading the entire presentation and yearning to simply enjoy our celebration without any professional obligations.
(4) Struggles With Performance And Toxic Hustle Culture
The breaking point for me came with the burden of guilt and shame imposed by the company for perceived underperformance.
If I chose to prioritize spending time with my son instead of attending a Saturday training meeting, I often felt inadequate, as if I wasn’t hustling hard enough to achieve my dreams.
The company lavished praise upon those who brought guests to meetings to convince them to join the team, while the rest of us were scolded for not engaging with enough people during the week.
During one meeting, a mentor paid tribute to an agent who had tragically passed away.
They praised their unwavering dedication and tireless efforts in the office, striving relentlessly to sell and build their team.
It was at that moment I realized that if I had limited time left to live, I wouldn’t want to spend it succumbing to the immense pressure of recruiting in a toxic work environment.
Instead, I’d want to cherish precious moments with my family, indulge in hobbies, and foster genuine connections with others.
Learnings
While my journey as a life insurance agent had its share of obstacles, it also provided valuable insights into what truly matters in life. Here are some aspects that helped shape my perspective:-
1. Time Management Magic:
Juggling client meetings, prospecting, paperwork, and still having a personal life can be a real balancing act.
But fear not! By mastering the art of effective time management, you can prioritize tasks and find that sweet spot between productivity and maintaining a healthy work-life balance.
2. Flexibility Is Your Superpower:
The insurance game is always changing, my friend. Customer preferences and market trends shift like the wind.
But here’s the secret sauce: Be adaptable and embrace flexibility in your sales strategies. Being open to change and rolling with the punches will set you up for long-term success.
3. Team Up For Success:
Building a solid network of referral partners is like having a crew of superheroes by your side.
Lawyers, financial advisors, and real estate agents—they can all become your trusted allies.
Collaborating with these professionals in related fields, you’ll generate a steady flow of high-quality leads and supercharge your business growth.
4. Relationships Are The Name Of The Game:
Remember, it’s not just about making that initial sale.
The real magic happens when you forge meaningful connections with your clients.
Keep those relationships alive and kicking by staying in touch, providing ongoing support, and addressing their evolving needs.
Trust me; it pays off in the long run with client loyalty and juicy referrals.
5. Power Up Your Motivation And Bounce Back:
Buckle up, my friend, because being a life insurance agent can sometimes feel like riding a roller coaster.
Rejection and challenges are part of the journey.
But here’s the deal: Tap into your inner well of self-motivation and resilience.
Keep that positive mindset, seek inspiration whenever you need a boost, and stay committed to personal and professional growth.
Trust me; you’ll conquer those obstacles like a champ!
Challenges
I encountered a few challenges during my tenure as a life insurance agent.
I believe it’s valuable for you to be aware of them while making your decision. Here are the challenges I faced:-
1. Intense Competition:
The life insurance industry is highly competitive, with numerous agents vying for clients.
Standing out and securing business can be challenging, especially in saturated markets.
2. Regulatory Compliance:
Life insurance agents must navigate complex regulations and compliance requirements, ensuring they adhere to legal and ethical standards.
This can involve extensive paperwork and stay up-to-date with industry changes.
3. Emotional Strain:
Dealing with sensitive topics like death and financial planning can be emotionally draining.
Agents may face difficult conversations and emotional situations while assisting clients, requiring strong empathy and emotional resilience.
4. Product Knowledge And Updates:
Staying abreast of evolving insurance products, policy options, and industry trends is crucial.
Continuous learning and professional development are necessary to provide accurate and valuable advice to clients.
Is It Worth Being An Insurance Agent?
You know what? Being a life insurance agent just wasn’t my cup of tea, and I had no regrets about waving goodbye to it.
Sure, there’s potential for a fat paycheck in the world of insurance, but let’s be real here – it’s not everyone’s jam, which is why many folks throw in the towel.
The constant hustle, never-ending networking, and sales pressure can be a heavy load.
Now, don’t get me wrong, I do believe life insurance has its value. But what I didn’t appreciate was the push to sell products like annuities and whole life insurance to folks who either didn’t need them or simply weren’t interested.
It just didn’t sit right with me.
My MLM (multi-level marketing) company wanted me to buy into this notion that there’s only one path to success and building wealth.
Well, call me a rebel, but I never bought into that idea.
Instead, I choose to focus on myself, my family and growing a business of my own while also staying true to my values.
Life doesn’t have to be all work and no play, my friend.
