The dashboard – now live – provides a clear view of salary trends for key roles in insurance agencies and brokerages across the US, including average, median, and percentile wages by occupation, state, and year for both broad and detailed compensation analysis.
Definitive Compensation Compass for US Insurance Agencies and Brokerages
Overview
The following provides a comprehensive overview of compensation trends for key roles in U.S. insurance agencies and brokerages, based on the latest available data from 2024. This dashboard, inspired by insights from Insurance Business America, aims to guide agencies in maintaining competitive, equitable, and compliant compensation packages in a talent-driven market.
Salary Trends by Role (2024)
- Chief Executive Officer (CEO):
- Average Salary: $317,110
- Trend: Declined by 1.3% from $321,360 in 2023, marking the first decrease since 2019. Despite this, CEOs remain the highest-paid role in the industry.
- Insight: The slight decline reflects market adjustments, but CEO compensation continues to lead due to strategic responsibilities.
- Statisticians:
- Average Salary Increase: 11% in 2024, the highest among all roles.
- Trend: A significant rebound from a 1.5% decline in 2023, driven by demand for data-driven decision-making in insurance.
- Insight: Statisticians are increasingly critical for risk assessment and pricing models, boosting their compensation.
- Other Key Roles:
- Roles such as insurance agents, brokers, and underwriters vary widely by experience and region. Detailed data is available in the Insurance Business America dashboard, covering average, median, and percentile wages.
Regional Salary Variations
- Highest-Paying Region:
- District of Columbia: Average salary across all occupations at $109,420 in 2024, up 3% from 2023. Consistent annual increases reinforce DC’s lead.
- Second and Third: Massachusetts and Washington, respectively, with competitive salaries driven by urban markets and high demand.
- Lowest-Paying Regions:
- States like Mississippi, Arkansas, and West Virginia report the lowest average salaries, reflecting lower cost-of-living and market demand.
Compensation Structures
- Standard Commissions:
- Typically a fixed dollar amount or percentage of premium, set at policy purchase or renewal. For example, Chubb’s 2022 data shows commission ranges for fire insurance (1%-35%), homeowners (2%-30%), and commercial multiple peril (0%-35%) [Web ID: 1].
- Contingent Commissions:
- Paid based on performance metrics like policy volume, premium growth, retention rates, or profitability. Chubb’s 2024 contingent commissions ranged from 0% to 13.4% [Web ID: 1].
- Supplemental Commissions:
- Additional payments based on prior-year performance (e.g., profitability, retention). Used by firms like Chubb for specific product lines like Marine Facilities.
- Producer Incentive Awards:
- Cash or non-cash rewards for meeting sales targets or other performance goals, common in programs like Chubb’s Cornerstone designation.
- Base Salary Plus Commission:
- Offers stability with a fixed salary and performance-based commissions. Ideal for early-career producers, with commission rates typically lower than straight commission models [Web ID: 6].
- Straight Commission:
- Earnings tied entirely to sales performance, offering high earning potential but income volatility. Best for experienced producers with established networks [Web ID: 6].
- Peachy/NCC Plan:
- A tier-based model with diverse incentives, including residual commissions for client retention. Suited for growth-focused agencies but complex to manage [Web ID: 6].
Regulatory Considerations
- Broker Compensation Disclosure (CAA, 2021):
- Effective December 27, 2021, brokers must disclose direct and indirect compensation exceeding $1,000 for group health plans, including commissions, bonuses, and finder’s fees [Web ID: 2, 7, 11].
- Disclosure must detail services provided, provider identity, and compensation types. Automation tools like AgencyBloc’s AMS+ can streamline compliance [Web ID: 2].
- CMS 2025 Rules for Medicare Agents:
- A $100 increase in commissions for Medicare Advantage (MAPD) plans ($726 initial, $363 renewal) and Prescription Drug Plans (PDP) ($200). Rules target independent agents, not third-party marketing organizations (TMPOs) [Web ID: 4].
Strategic Insights
- Talent Retention: Competitive compensation is critical in a talent-driven market. The Insurance Business America dashboard highlights the need for equitable packages to attract and retain top talent [Web ID: 0, 10].
- Regional Strategy: Agencies expanding regionally should align salaries with local benchmarks, with DC, Massachusetts, and Washington offering the highest compensation potential.
- Compliance: Transparency in compensation, mandated by the CAA and NAIC/NCOIL model laws, enhances trust and supports regulatory compliance [Web ID: 2, 8, 11].
- Producer Compensation Models:
- Agencies can afford 25%-35% commission on renewals and 40%-50% on new business, assuming 10%-20% pre-tax profit goals [Web ID: 9].
- Small accounts (<$1,000-$2,500 commission) may yield lower or no renewal commissions if handled by account managers [Web ID: 9].
Recommendations
- Access the Dashboard: Utilize the Insurance Business America “Insurance Agencies and Brokerages Salaries” dashboard for detailed, role-specific, and state-specific data to benchmark compensation [Web ID: 0, 10].
- Adopt Technology: Use agency management systems (e.g., AgencyBloc’s AMS+) to automate disclosure compliance and track commissions [Web ID: 2].
- Tailor Compensation Models: Choose compensation structures (e.g., base salary plus commission for new producers, straight commission for veterans) based on agency goals and producer experience [Web ID: 6].
- Monitor Regulatory Changes: Stay updated on CMS and CAA requirements to ensure compliance and avoid penalties [Web ID: 2, 4, 11].
Sources
- Insurance Business America: Salaries Dashboard [Web ID: 0, 10]
- Chubb: Broker and Independent Agent Compensation [Web ID: 1]
- AgencyBloc: Broker Compensation Disclosure [Web ID: 2]
- Insurance Forums: 2025 CMS Rule [Web ID: 4]
- Next Call Club: Compensation Plan Comparison [Web ID: 6]
- NAIFA: CAA Disclosure Requirements [Web ID: 11]
- Insurance Journal: Producer Compensation [Web ID: 9]
This compensation compass equips agencies with actionable insights to navigate the competitive and regulated insurance landscape effectively.