A sales career – a challenging path some might say, as it is filled with hardship and tasks such as cold calling, door knocking, or face-to-face presentations to sell their product or service.
Although, sales is one of life’s most exciting career that everyone should experience in their life.
Mustering up the courage to walk up and speak to a stranger or the ability to convince someone are skill sets that will prove useful to all areas of your life.
You can scale great mountain of achievements once you overcome emotions that impede your path to success.
That said, whenever we speak about a sales career with limitless income opportunities – property and insurance are the ones that usually come to mind.
Comparing the choices out there, the real estate and insurance industry immediately shines as the most popular ones due to their perks – flexibility and being your own boss.
Often, those who work hard and smart in these industries tend to walk a lucrative journey, potentially hitting five to six-figures commission each month. These happenings are common even for newbies in their first year.
We are talking about five to six-figure salaries each month, which are usually the earnings of your typical high-earning professionals like pilots, lawyers, and doctors, which requires years of effort to become one.
Sounds lucrative, isn’t it?
But of course, not everyone who dabs into the real estate and insurance industry will succeed, but that goes for any other industries as well.
So what are the core differences between a real estate agent and an insurance agent?
While both professions deal mainly in sales, they are offering different types of products and services to their clients.
They have many similar responsibilities but yet with clear differences.
What are the main similarities between Real Estate Agents and Insurance Agents?
You would have to be at least 21 years old to begin.
Certifications and Qualifications:
To become a real estate or insurance agent, you would have to take up the required courses and exams to receive your certifications and licenses.
For insurance, you need to pass all 4 papers from the Singapore College of Insurance (SCI).
If you can’t stand the 9 to 5 desk job, being a real estate agent or insurance agent would be your haven.
Besides being your own boss, you would have flexible working hours. Although, it also means that you might have to work during the weekends or even on public holidays as that is usually your clients’ free time.
That said, your income is derived from the effort that you put in.
Both professions do not have a base salary. Hence, their incomes mainly come from commissions, which grants them the ability to earn a high-commission from just a few sales.
Apart from the face-to-face meet up to discuss details with their clients, both professions are responsible for marketing their services to grow and expand their business and networks.
Note: Property agents usually need to fork out a higher marketing cost due to their need to advertise on multiple portals and platforms.
When deals are confirmed, both agents are required to fill up and record the paperwork for their clients.
From our point of view, the paperwork is usually less complicated for property transactions as compared to insurance.
Working Well Independently and With Others:
Most real estate and insurance agents start out by joining experienced mentors or veterans in established agencies. Both a great mentor and agency can provide guidance, relevant training, and technology support to newbies.
Both professions usually operate a one-man show as they are their own marketer, admin, sales, customer service and other areas that require them to do so.
Amidst the competition in both industries, it is essential for an agent to have great team support.
As such, it is imperative for one to be a great team player that cooperates with their team members.
The more time you spend in the sales industry, the more you will understand the sentence below:
When you run alone, you can run fast. When you run together, you can run far.
Communication and Grooming:
When it comes to selling a multi-million dollar property or insurance policies worth hundreds of thousand, all clients would want a trustworthy and amicable person.
Hence, it is essential for both professions to be trustworthy, knowledgable, and have great communication skills.
Dressing and personal grooming is also an important element for striking a good impression as your clients do evaluate you on your personal bearing.
Just imagine entrusting your property or policy to someone who wears berms and slippers to meet you – um, you probably wouldn’t want that.
What are the main differences between Real Estate Agents and Insurance Agents?
To become a Real Estate Agent, you will need a minimum of four GCE ‘O’ Level passes or equivalent (taken at not more than 2 sittings).
To become an Insurance Agent, you will need a GCE ‘A’ Level certificate with passes in at least three subjects at “Higher 2” level and two subjects at “Higher 1” level. Either that or a Polytechnic Diploma in Singapore or any other equivalent academic qualifications.
Products and Services:
Real Estate Agents can pick their types of properties to work on. From HDB and Condo resales, to new launches, to landed properties, there are many choices for Real Estate Agents to focus on.
Note: Resale Property Agents have to source for their own inventory.
Insurance Agents have their own specializations too to work on. They can also choose the role of a generalist to provide various policies, from savings to hospitalization to investment plans.
Note: Insurance Agents do not need to source for their own inventory as their policies are created by their affiliated company.
Income for Real Estate Agents:
A typical rental deal closed by real estate agents would net them between 1-2 months of rent as their commission. Renewal commissions may also kick in if the tenants decide to renew.
Some top producers even hire people to help manage their lease renewals as the amount is high, netting them 6-figure earnings consistently every year.
A typical property sale will bring property agents a 1-2% commission for resale and 2-4% for new launches. Meaning, a million dollar deal can potentially yield property agents a $10,000 to $40,000 commission.
Note: Commission will be split when there is co-broking (sharing deals between agents when they bring clients to one another) involved.
Therefore, to make $100,000 annually, a Real Estate Agent would need to close around ten 1 million dollar home sales (assuming 1% commission) or just one 4 million dollar home sales (assuming 2.5% commission).
The fact that it is possible and very common for Property Agents to earn 6-figures income annually has attracted many individuals to take on this career. The elites of this industry are even making 6-figures a month!
Income for Insurance Agents:
Insurance Agents earn based on the products they sell – Whole life, Term, Accident, Hospitalization, etc.
Each type of product has a different type of payout and Insurance Agents usually get paid a higher First Year Commission (FYC), accompanied by lower annual commissions for renewal.
There are some policies like Personal Accidents that can potentially net Insurance Agents lifetime renewals.
Additionally, there are attractive bonuses and incentives that financial advisers may earn along the way.
Have a look at this chart:
For example, if you managed to close a whole life policy with a $4000 annual premium in your first year, your FYC will be $2000 and $1000 for the second year, followed by $200 up till the sixth year.
Therefore, to make $100,000 in your first year – you need to close 50 cases like the above.
For Real Estate Agents, the good ones typically keep in touch and send updates constantly to their clients throughout the year.
The great ones would have a system to retarget prospects who did not buy with them. Similarly, Insurance Agents would have it too.
For rental cases, agents will usually touch base 1-2 times over the lease duration unless they are required to convey any messages between the landlords and tenants.
For Insurance Agents, their after-sales service is critical.
They have to analyze their clients’ policies and their financial situations annually to suggest any additional amendments for their coverage.
During difficult times, they would also be needed to assist with making claims.
There are times when property agencies are appointed by the property developers to market their new launch projects overseas.
This signifies that you may have the opportunity to travel abroad and learn about their markets, as well as expanding your overseas clientele base.
For Insurance Agents, chances of overseas opportunities are slim.
Closing a Sale
Real Estate Agents value skills like negotiation and Public Relations (PR) as they frequently negotiate the terms of deals and prices.
The ability to observe and evaluate a prospect is desirable as they would be able to get maximum leverage for their clients.
For Insurance Agents, their policies’ prices and terms are set by their agencies. As such, they usually do not engage in negotiation.
This is a hot topic when it comes to choosing a real estate and insurance career.
Real Estate Agents usually perform better in this area as their friends and family usually respond positively to them. Their engagements are typically on the topics of the newest market trends and good deals.
It is effortless to call a friend out for a drink.
Whereas the stigma of an Insurance Agent is often negative and their friends and relatives tend to react cautiously when it comes to meeting up.
Hence, when it comes to starting out, warm market leads are typically harder.
The bottom line?
At the end of the day, both Real Estate Agents and Insurance Agents are fantastic and perpetual professionals that will stay relevant to our community as most people require aid in understanding the intricacies and comparison of each product.
Therefore, regardless of which profession you favor, both would surely provide you with an unforgettable and amazing journey.
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Navis Living Group is the #1 Fastest Growing Group in OrangeTee & Tie. Over the years, they have built a complete plaform that can support their real estate agents in every aspect.
They have groomed and produced countless Top Producers and elites of this industry in Singapore.
Join them in their exciting journey to become one of the best today.