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6 Incentives to Motivate Insurance Agents

November 4, 2021

For managers across nearly every industry, there’s an age-old question – how can I get the most out of my team? Sometimes that increased production looks like a raise, other times it’s extra vacation days, but it all boils down to one thing: how to incentivize ideal employee behavior.

In the insurance industry, carriers are largely responsible for motivating their agents to do whatever it takes to increase sales and improve customer service. And while there is no one-size-fits-all solution, there are a few strategies that many organizations have had success with. To help you start inspiring your employees to take their performance to the next level, here are 6 insurance agent incentive ideas, and some tips to help make implementing these measures as seamless as possible.

Download the Novarica Marketing Navigator Report to learn how Duck Creek Distribution Management Can Help You Incentivize your Agents

Why Should Carriers Make Incentives a Priority?

Some old-school insurance executives might be hesitant to implement any type of incentive program. After all, shouldn’t a paycheck be motivation enough to perform one’s job at a high level? In an ideal world, that answer would be yes, but in an increasingly competitive job landscape, many carriers are having to find new ways to attract and retain top talent. It’s the classic “carrot and stick motivational juxtaposition — and more often than not, the carrot proves more effective.

Insurance carriers should leverage agent incentive programs in an effort to spark change in their selling behavior by offering the right motivation. This will look slightly different from organization to organization, but all incentive programs should have the same principles. As insurance quote aggregator Everquote put it, “the incentive program you offer is indicative of your company culture — with it, you’re not only showing top-down appreciation and support for your team, you’re also financially growing your employees, which means you will be able to keep your great staff for a longer period of time. Byproducts of incentive programs include increased employee retention, recruiting of better talent, and, ultimately, financial growth.”

Types of Agent Incentives

Before carriers decide what incentives they will offer to their agents, they must first decide what behaviors or outcomes warrant a reward. Many carriers choose to incentive one, two, or three of the following:

  • Output – agents compete against themselves to earn rewards
  • Performance – for every X number of policies signed, agents get X in reward
  • Behavior – specifically ones that drive revenue, especially customer service

Once a carrier decides what their award standards will be, they must then determine what exactly they will be incentivizing agents with. This usually fall into one of two categories: monetary incentives and non-monetary incentives.

Non-monetary Incentives:

  • Gamification — put selling contests with prizes to encourage agents to “win” that competition.
  • Easily updated compensation — leverage a distribution management system that makes updating compensation plans easy and seamless
  • Tier structure — create different performance tiers that agents can perform to, which in turn may translate into other rewards or a higher commission level.

Monetary Incentives:

  • Higher commissions
  • Gift cards
  • Company-paid trips — such as a sales or insurance conference
  • Vacation packages and vacation pay

Tips for Implementing Incentive Programs

As we mentioned, not every agent incentive program is right for every carrier. You certainly don’t want to bite off more than you can chew, and conversely, offer incentives that don’t achieve the desired result. Some implementation best practice tips are:

Choose incentive programs that are scalable

One of the goals of an incentive program is that it will attract top talent to work for your organization. Therefore, you don’t want to choose incentives that can’t scale with you. So, carriers must be careful to not offer too much as a reward but enough that agents will be motivated to step up their game.

Leverage solutions that make incentivizing easier

There are SaaS-based billing solutions that empower carriers with the capabilities they need to almost implement a set it and forget it incentive program. With this technology, carriers can promote the incentive program, reduce expenses, and enhance their incentive programs by automating many functions that help calculate commissions.

Begin and end with ROI in mind

Rolling out an incentive program can be exciting, and agents will surely get an adrenaline boost when they hear about a potential increase in earnings. However, it is critical that carriers don’t lose sight of why they want to incentivize agent behavior, which is ultimately to increase sales and the bottom line. By keeping the ROI in mind, your incentive program promises to be more effective for all stakeholders.


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Prasad Boppana
Prasad Boppana leads the Distribution Management practice at Duck Creek as part of his responsibilities with our emerging portfolio of products. Prior to this, Prasad was CEO of Outline Systems, which was acquired by Duck Creek in October of 2018. Prasad has extensive experience in commercializing software products, building and managing global teams, and driving business results. He sees tremendous opportunities for the insurance sector and is passionate about helping insurance companies with their digital transformation initiatives.