How to Become an Insurance Agent in Nigeria

How to Become an Insurance Agent in Nigeria

Insurance Agent in Nigeria

Only 0.5% of Nigerians have insurance, while our friends across the world in the US have a whopping 91.7% coverage. If you’re an aspiring insurance agent in Nigeria, this is good news because these numbers show the untapped potential waiting for you in one of the fastest-growing industries in the country.

So, if you’re ready for your next career move, this article will cover all you need to know to be the next best insurance agent in the country and how you can drive change in an infant industry with maximum potential.

What does an insurance agent do?

Insurance agents follow up on leads, meet potential customers, listen to customer needs, and suggest suitable options for auto, health, home, and life insurance.

These are the basics, but to know what you want to do as an insurance agent, you must figure out which industry best suits you. In the next section, we’ll talk about the different categories or policies in insurance.

Categories of insurance policies

In Nigeria, we have 5 main types of Insurance policies, namely:

  1. Life Insurance
  2. Health Insurance
  3. Property Insurance
  4. Auto Insurance
  5. General Insurance

Life Insurance

Life insurance is a financial promise that an individual makes with an insurance company to ensure the well-being of their loved ones once they die.  Here, your client will pay regular premiums, and in return, the insurance company commits to providing a lump sum, known as the death benefit, to the beneficiaries chosen by said client.

There are different types of life insurance, such as term life insurance with coverage for a specific period and permanent life insurance that lasts a lifetime and accumulates cash value.

As an insurance agent, your task would be to tailor these options to your client’s unique goals and circumstances, whether it’s securing their children’s education, paying off a mortgage, or leaving a legacy.

Health Insurance

Life is unpredictable, and so is health. A sudden illness or injury can be a financial disaster without insurance. Thankfully, when these health events happen, insurance companies step in to cover or share the costs.

However, health insurance isn’t stagnant; it evolves. You stay on top of new plans, policy changes, and healthcare laws. You help clients navigate the paperwork, and based on what you’ve learned about your client, you sift through the different insurance packages and plans to find the one that fits perfectly to their budget, health history, and preferred doctors.

Property Insurance

Property insurance is the safety net for physical assets against natural disasters, theft, or bizarre kitchen fires.

As an agent, you’d need to understand what falls under property. Some include homes, business insurance, and anything valuable that can be damaged, lost, or stolen. When you understand the different assets involved you can better tailor their insurance according to the respective policies. A business would need different coverage than a residential building.

Auto Insurance

Auto Insurance covers anything vehicle-related. In exchange for regular client payments, your company promises to cover financial losses or damages resulting from accidents, theft, vandalism, natural disasters, liability, or other unexpected incidents.

During your time working, it will be up to you to understand the different terms needed, educate, and navigate the necessary activities for unique clients.

General Insurance

General Insurance covers non-life aspects such as travel, education, liability, marine, and fire insurance.

Types of Insurance Agents

There are 2 types of insurance agents: Independent and Exclusive Agents. The main difference between the two is that independence enables you to sell for different insurance companies, while exclusive means you sell for only one. Let’s go into details.

Who is an Independent Insurance Agent?

Otherwise known as insurance brokers, independent insurance agents offer insurance policies for sale from a variety of different insurance companies. People who become independent live a flexible lifestyle while helping people and earning a potentially high income.

Plus, since this career doesn’t necessarily require a bachelor’s degree, it is an accessible option for those with limited time or resources. Independent insurance agents can offer multiple types of insurance policies, such as life, motor vehicle and income protection, or they can specialize in one type.

Because independent insurance agents are solo entrepreneurs, they are also responsible for the administration, marketing, and financial management of their business.

Who is an Exclusive Insurance Agent

The main reason an insurance agent will work as an exclusive agent is income stability. The exclusive insurance brokerage generally provides an office, administrative staff to process paperwork, ongoing training, significant bonuses and other motivational programs, and an impressive national advertising budget. When consumers respond to advertising, the company directs them to an exclusive sales agent in their area and generally provides extensive lists of prospects to agents.

Although exclusive agents often earn a salary, many are independent contractors and earn only a commission based on their sales. Exclusive sales agent synergistic includes automatic commissions on their renewals as long as they remain contracted with the issuing company.

Skills Needed in an Insurance Agent

The third top reason for low insurance penetration in Nigeria is the lack of skilled personnel. This goes to show that companies are searching for individuals who possess the necessary skills to skyrocket the industry. Some of these skills include:

Sales skills

Insurance agents usually have sales targets to meet, and they may receive incentives if they exceed sales targets. Having sales skills can help you understand the problems that customers may be facing and suggest policies that best address their concerns.

As clients may have questions or doubts before purchasing an insurance policy, strong sales skills, such as negotiation, help agents convince customers to choose a particular policy. This allows agents to increase sales and build lasting relationships with their client base.

Interpersonal abilities

Having strong interpersonal skills can help insurance agents build relationships with their customers, which can help them gain more clients. Some interpersonal skills that help insurance agents include active listening, empathy, patience and persuasion. They help you show clients that you understand their requirements and problems. This can help you get repeat sales from the same customer and grow your sales numbers.

Customer service

Good customer service can help you distinguish yourself from other agents in the market and create a positive image for your organization. These skills include professionalism and the ability to prioritize the needs of customers. When a client is happy with your services, they may recommend you to others looking to purchase an insurance policy. Good customer service skills also help agents achieve their sales targets, acquire loyal customers and generate revenue for their organization.

Average salary for Insurance agents in Nigeria

The average salary for insurance agents is 200k per month, with a salary that ranges from 40,000- 300k per month. The salary for insurance agents varies depending on the industry in which the agent is working and their geographic location. Agents who work for direct health and medical insurance carriers tend to make more than other agents.

How to become an Insurance Agent in Nigeria

Whether you want to become an independent or captive insurance broker you will most likely follow the same path to success. In this section, we will highlight the necessary steps all insurance agents must go through.

Step 1: Education

Most insurance companies require a minimum qualification of a secondary school leaving certificate or its equivalent. Some firms may require a bachelor’s degree in a related field like business, finance, or economics.

Step2: Licensing

All insurance agents in Nigeria must be licensed by the National Insurance Commission (NAICOM).

To obtain a license, you need to complete a pre-licensing education program approved by NAICOM. After completing the education program, you must pass an examination conducted by NAICOM. Once you pass the examination, you will be issued a license to practice as an insurance agent.

The two most common license types for insurance agents are:

1. Property and Casualty (P&C) License: This license allows agents to sell insurance products related to property and casualty coverage. Agents with a P&C license typically serve clients who require coverage for their homes, vehicles, businesses, and other property.

Examples of insurance products covered under a P&C license include auto insurance, homeowners’ insurance, renters’ insurance, commercial property insurance, and liability insurance. Agents with a P&C license help clients protect their assets from damage, theft, or liability claims.

2. Life, Health, and Accident (L&H) License: This license enables agents to sell insurance products focused on life events, health, and accidents. Agents with an L&H license primarily assist individuals and families in obtaining coverage for life insurance, health insurance, disability insurance, long-term care insurance, and other related products.

They help clients plan for financial protection in case of illness, injury, or death. L&H agents play a vital role in helping individuals secure coverage for their healthcare needs and prepare for unexpected life events.

Note: your career plan or the company you plan to represent may require you to obtain multiple licenses. Some insurance agents choose to hold both a P&C license and an L&H license to offer a broader range of insurance products and better serve their clients’ needs.

Step 3: Find a Job

Whether you choose to go the independent or captive route, you will still be required to find a good company offering packages you can sell or represent.

Start by conducting a comprehensive online search for insurance companies operating in Nigeria and identify reputable insurance companies that best suit the type of insurance you’d want to sell or the clientele you’d like to serve.

Read customer reviews and testimonials to gauge the reputation and reliability of each company and seek recommendations from professionals already working in the insurance industry in Nigeria.

Step 4: Invest in training.

You never truly stop learning, and if you’d like to grow further in your career, you should invest in technical and soft skills related to your field.

National Insurance Commission (NAICOM), and the Nigerian Insurance Institute (NII) provide training and certification programs for different relevant skills.

And if you’re lucky to be in an insurance company that offers in-house training sessions for their agents, make sure to take full advantage.

Step 5: Build a client base.

Your work as an insurance agent is to sell. And you’d be selling to people, not dogs. This is where your marketing and sales skills will come into play. Networking and building relationships are crucial to becoming a successful insurance agent in any field.

To succeed in this industry, it is essential to have a strong and extensive network of clients. Here are some strategies for prospecting and acquiring clients, as well as tips for effective client management and retention.

Strategies for Prospecting and Acquiring Clients

  1. Understand your target market and tailor your prospecting efforts to their needs and preferences.
  2. Offer free consultations or assessments to potential clients, showcasing your expertise and knowledge.
  3. Collaborate with other professionals, such as real estate agents or financial advisors, who can refer clients to you.
  4. Develop a strong referral program (in line with your company’s policy) that rewards clients for referring new business to you.
  5. Regularly communicate with your clients to maintain a strong relationship and provide personalized service.
  6. Offer additional products or services that can add value to your clients’ insurance policies.
  7. Regularly review and update your clients’ insurance coverage to ensure it aligns with their changing needs.
  8. Stay in touch with your clients through newsletters, email updates, or personalized birthday messages.
  9. Show appreciation to your clients for their continued business by organizing special events or sending small gifts.

Conclusion

These days, insurance companies are always on the lookout for aspiring insurance agents and offer the training needed to become one. We hope the information above serves as a guide to what you can expect if you’re contemplating a career path in insurance and aspire to become an insurance agent.

Sign up for the newsletter

If you want relevant updates occasionally, sign up for the private newsletter. Your email is never shared.

Home

Marketplace

Learn

My Items

Home

Marketplace

Learn

My Items

More