How Much Do Insurance Agents Make Per Policy? (2026 Rates)

You're about to buy a policy, and part of every premium dollar goes to the agent who sold it to you. How much?

So how much do insurance agents make per policy? Most earn a set share of the premium, about 8% on auto and 12% on homeowners, or a flat monthly amount per person on health plans. Life insurance is the outlier, with first-year commissions of up to 55% of premium at insurers licensed in New York.

Below, you'll find insurance agent commission rates by line, a worked dollar example for each, a close look at group health plans, and who pays for all of it. At the end, we cover how employers can find out what their benefits broker earns.

How Much Do Insurance Agents Make Per Policy?

On a $1,500 auto policy, the agent's commission is about $116. On a 40-employee group health plan paying $38 per enrolled employee per month, the agent earns $18,240 a year.

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These figures differ between captive agents, who sell for one insurer, and independent agents, who are appointed by several. We cover the difference below.

For context on insurance agent salary, the U.S. Bureau of Labor Statistics (BLS) puts the median annual wage for insurance sales agents at $62,280 in May 2025.

How Insurance Commissions Work

The insurance company pays the agent's commission out of the premium it collects. So how do insurance agents get paid? The insurer builds the commission into its rates, collects the premium from the policyholder, and pays the agent a set amount for each policy sold or renewed. The money still starts with the person or business that buys the policy.

Insurers publish these amounts in agent commission schedules. Blue Cross and Blue Shield of Nebraska's 2025 Agency Commission Schedule, for example, pays $20 per member per month on its individual Nebraska HeartlandBlue medical plans, "New or Renewal." For a single policyholder, that's $240 a year.

First Year vs Renewal Commissions

A first-year commission is what the agent earns when the policy is sold. A renewal commission is what they earn each year the policyholder keeps it.

How much the rate changes at renewal depends on the line:

• Life insurance pays most of its commission in year one. New York's Insurance Law Section 4228 caps first-year agent commissions at 55% of qualifying first-year premium for insurers it licenses.
• Individual health can step down slightly, or not at all. UnitedHealthcare's 2026 Agent Commission Schedule pays $20 per member per month on new policies and $18 at renewal in Colorado, and $27 for both in Florida.

For a family of three in Colorado, that's $720 in the first year and $648 in each renewal year.

Captive vs Independent Agents

A captive agent sells policies for one insurance company. An independent agent is appointed by several insurers and can sell any of their policies. Both represent the insurance company in the sale.

That difference shows up in pay. The BLS reports that agents who work for insurance carriers or agencies are paid a salary, a salary plus commission, or a salary plus bonus, while independent agents may be paid by commission only.

Agents employed directly by insurers also earn more at the median. In May 2025, insurance sales agents at health and medical insurance carriers earned a median of $73,440, and agents at other direct insurance carriers earned $63,810. At insurance agencies and brokerages, the median was $61,550.

Commission Rates by Insurance Type

Commission rates swing widely by line, from a flat dollar amount per person on health plans to more than half the first-year premium on life insurance. Here's what each line pays, with a worked example.

Individual Health Insurance

Individual health plans pay a flat amount per member, so the agent earns the same whether the buyer picks a bronze plan or a platinum one. UnitedHealthcare's 2026 Agent Commission Schedule pays $15 to $27 per member per month (PMPM) on new Individual & Family ACA Marketplace policies, depending on the state. The low end is Indiana and Kansas, and the high end is Florida.

A family of three at $20 PMPM generates $720 a year for the agent. On an $18,000 annual premium, that's 4% of what the family pays. Business owners weighing individual coverage options against a group plan will see this per-member model on the individual side.

Group Dental Insurance

Group dental pays a much smaller flat amount than group medical. Blue Cross and Blue Shield of Nebraska's 2025 Agency Commission Schedule pays $5 per enrolled employee per month on its SignatureBlue Dental group plans with 3 or more enrolled employees.

A 20-person dental plan pays the agent $1,200 a year. On a $10,800 annual premium, that's about 11% of what the employer pays.

Life Insurance

Life insurance agent commission is front-loaded. New York's Insurance Law Section 4228 caps the first-year commission at 55% of qualifying first-year premium, and the cap applies to New York-licensed insurers wherever they sell. Insurers outside that system set their own schedules.

On a policy with a $1,000 first-year premium, a New York-licensed insurer can pay the agent up to $550.

Auto Insurance

Auto agents earn about 8% of premium. Across the US, auto insurers paid commissions equal to 7.7% of premium in 2023, according to A.M. Best data in the 2024 Arizona P&C Marketplace Report. The figure covers all premium written that year, new and renewing.

On a $1,500 auto policy, that works out to about $116 a year.

Homeowners Insurance

Homeowners policies pay agents a larger share, about 12% of premium. The same A.M. Best data puts US homeowners commissions at 12.4% of premium in 2023.

On a $2,000 homeowners policy, the agent's share is $248 a year.

How Much Agents Make on Group Health Plans

Group health is where agent pay adds up. A 40-employee plan at $38 per enrolled employee per month pays the agent $18,240 a year, more than 150 years of commission on a $1,500 auto policy.

Agents on employer plans earn in one of two ways.

1. A flat amount per employee per month (PEPM). Blue Cross and Blue Shield of Nebraska's 2025 Agency Commission Schedule pays agents $38 per enrolled employee per month on BluePride groups of 6 to 50 and $36 on groups of 51 to 100. Groups of 3 to 5 pay $8, and PremierBlue groups of more than 500 pay $6, so the per-person amount falls as groups grow. The schedule lists one rate per group size, with no separate renewal rate.
   
   
2. A percentage of premium. Here, the commission moves with the employer's bill. 

The base commission isn't always the whole check. Blue Cross and Blue Shield of Nebraska also pays a renewal bonus to agencies with at least 500 enrolled contracts across its group lines, tied to the agency's net growth.

Why a Percentage Commission Grows With the Premium

A flat PEPM commission stays the same when premiums rise. A percentage commission rises with them.

Take a 40-person company where every employee has single coverage at KFF's 2025 small-firm average of $9,211 per year. Here's what happens at a hypothetical 5% agent commission:

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The employer pays $73,688 more. The agent earns $3,684 more for the same plan and the same employees. That's why small business benefits management starts with knowing how your plan's commission is calculated.

Who Pays Insurance Agent Commissions?

The policyholder does. The insurance company writes the check, but it funds that check from the premium.

The chain runs like this:

1. The insurer prices the commission into its rates.
2. The policyholder or employer pays the premium, with the commission already inside it.
3. The insurer pays the agent their share.

Because the cost sits inside the premium, it never appears as a separate line on the bill. On employer plans, it adds to the healthcare costs small businesses already carry, whether the plan is level-funded or self-funded or sits inside a PEO (here's how much a PEO really costs).

Some states give buyers a right to see the number. New York's Regulation 194 requires agents to disclose, at or before application, whether they will receive compensation from the selling insurer and that the buyer can request details of that compensation. If the buyer asks, the agent must provide it in writing.

How to Find Out What Your Broker Makes

If your company buys group health coverage through a benefits broker, you can find out exactly what that broker earns from your plan.

1. Request the written CAA disclosure. The Consolidated Appropriations Act of 2021 (CAA) requires brokers and consultants who expect $1,000 or more from a group health plan to disclose their direct and indirect compensation in writing, reasonably in advance of signing, renewing, or extending the contract.
   
   
2. Check Form 5500 Schedule A if you sponsor an ERISA plan that files one. Schedule A lists the total commissions and fees paid under each insurance contract. Fully insured welfare plans with fewer than 100 participants are generally exempt from filing. Search filings in the EFAST2 Form 5500 database.
   
   
3. Ask directly for all compensation, including bonuses. The base health insurance broker commission is only part of it. Ask about bonuses, overrides, and referral fees, then run the numbers in Ignition's commission calculator or other benefits decision support tools.

Ignition Benefits is the employee benefits broker that shows every commission up front and wins only when the client saves. It runs a full-market audit at every renewal, in 14 to 21 days, from two 15-minute calls.

• AWM, a 44-person wealth management firm in Phoenix, faced a 22.8% renewal increase to $718,457. Ignition moved it to a level-funded plan and cut the bill to $561,543: $156,914 saved.
• Light Labs, a 29-person company in Austin, turned a 21% renewal increase into an 8% decrease: $113,115 saved in year one.

See Every Dollar Your Broker Makes With Ignition Benefits

A benefits broker commission comes out of your premium every year, so it pays to know the number. Ignition shows you every dollar of its compensation from day one and runs a full-market audit before your renewal.

If your renewal is 90 days out or less, start now. Switching takes one Broker of Record letter, and your employees keep their plans in the meantime. 

See how you can stop overpaying for employee benefits.