The commission rate for health insurance agents is between 40% to 100% of the first-year premium and 1% to 2% for renewals. Including base pay and commission, a health insurance agent averages a total of $50,600 but can reach as high as $120,000, thanks to the earning potential of your commission.
Insurers pay brokers a commission for the employers they get to sign up. That fee is usually a healthy 3 to 6 percent of the total premium. That could be about $50,000 a year on the premiums of a company with 100 people, payable for as long as the plan is in place.
That's $50,000 a year for a single client. And as the client pays more in premiums, the broker's commission increases.
Commissions can be even higher, up to 40 or 50 percent of the premium, on supplemental plans that employers can buy to cover employees' dental costs, cancer care, or long-term hospitalization.
Those commissions come from the insurers. But the cost is built into the premiums the employer and employees pay for the benefit plan.