An insurance agent is an insurance professional who sells an insurance company’s products to consumers for a commission. According to Indeed, the average salary for an insurance agent is $56,013 per year in the United States.
But insurance agents, and aspiring insurance agents, need to keep in mind that this is an average figure and that it can be much higher depending on which state the agent operates in.
Figuring out which state is best to be based in may seem intimidating, and that is why we have compiled a list of the 12 most profitable US states for insurance agents.
Most Profitable US States for Insurance Agents
Besides considering annual salaries, this article will also consider the location quotient (LQ). The LQ is a measure used by the Bureau of Labor Statistics (BLS) to determine how concentrated a certain industry is in a single state compared to the nation as a whole.
To determine the LQ, the local industry employment has to be divided by the all-industry, all-ownerships total of local employment.
Then, the national industry employment is divided by all industry, all ownerships total for the nation. Finally, the local ratio is divided by the national ratio.
When an LQ is equal to 1, then the industry has the same share of its area employment as it does in the nation. An LQ greater than 1 indicates an industry with a greater share of the local area employment than is the case nationwide.
1. Vermont
Vermont is ranked as the number one state as the average annual salary is $60,504 for insurance agents. The lowest 10% of insurance agents are estimated to earn $42,000 annually, while the highest 10% are estimated to earn a whopping $85,000.
The LQ for Vermont is 1.77, meaning the industry has a greater share of the local area employment than is the case nationwide.
2. Pennsylvania
Pennsylvania is ranked second as the average annual salary is $60,229 for insurance agents. The lowest 10% of insurance agents are estimated to earn $38,000 annually, while the highest 10% are estimated to earn a whopping $93,000. The LQ for Pennsylvania is 1.27.
3. Nebraska
Nebraska is ranked third as the average annual salary is $57,294 for insurance agents. The lowest 10% of insurance agents are estimated to earn $36,000 annually, while the highest 10% are estimated to earn a whopping $89,000. The LQ for Nebraska is 1.44.
4. North Dakota
North Dakota is ranked fourth as the average annual salary is $62,956 for insurance agents. The lowest 10% of insurance agents are estimated to earn $42,000 annually, while the highest 10% are estimated to earn a whopping $93,000. The LQ for North Dakota is 1, meaning the industry has the same share of its area employment as it does in the nation..
5. Iowa
Iowa is ranked fifth as the average annual salary is $61,076 for insurance agents. The lowest 10% of insurance agents are estimated to earn $39,000 annually, while the highest 10% are estimated to earn a whopping $95,000. The LQ for Iowa is 1.12.
6. Michigan
Michigan is ranked sixth as the average annual salary is $59,274 for insurance agents. The lowest 10% of insurance agents are estimated to earn $38,000 annually, while the highest 10% are estimated to earn a whopping $91,000. The LQ for Michigan is 1.21.
7. Alabama
Alabama is ranked seventh as the average annual salary is $59,082 for insurance agents. The lowest 10% of insurance agents are estimated to earn $34,000 annually, while the highest 10% are estimated to earn a whopping $102,000. The LQ for Alabama is 1.11.
8. Kansas
Kansas is ranked eighth as the average annual salary is $60,456 for insurance agents. The lowest 10% of insurance agents are estimated to earn $37,000 annually, while the highest 10% are estimated to earn a whopping $98,000. The LQ for Kansas is 0.91.
9. Massachusetts
Massachusetts is ranked ninth as the average annual salary is $61,387 for insurance agents. The lowest 10% of insurance agents are estimated to earn $42,000 annually, while the highest 10% are estimated to earn a whopping $89,000. The LQ for Massachusetts is 1.05.
10. New York
New York is ranked tenth as the average annual salary is $66,052 for insurance agents. The lowest 10% of insurance agents are estimated to earn $43,000 annually, while the highest 10% are estimated to earn a whopping $100,000. The LQ for New York is 0.85.
11. Wisconsin
Wisconsin is ranked eleventh as the average annual salary is $58,040 for insurance agents. The lowest 10% of insurance agents are estimated to earn $37,000 annually, while the highest 10% are estimated to earn a whopping $89,000. The LQ for Wisconsin is 0.97.
12. Texas
Texas is ranked twelfth as the average annual salary is $38,874 for insurance agents. The lowest 10% of insurance agents are estimated to earn $21,000 annually, while the highest 10% are estimated to earn a whopping $71,000. The LQ for Texas is 0.92.
The Takeaway
The mentioned states all offer prime conditions for aspiring insurance agents to build client bases. Although many of the average, and top 10%, salaries are extremely attractive, aspiring insurance professionals need to keep in mind that those salaries will come with time, and not in the beginning stages.
For individuals interested in becoming an insurance agent, for example, individuals in Texas wanting to become an insurance agent would need to obtain a Texas insurance license. The Really Useful Information Company (TRUiC) is able to offer more information on insurance licensing in specific states.
