Is it more profitable to be an insurance agent or a real estate agent?

What are the differences between an insurance agent and a real estate agent?

Before starting the comparison, it is important to understand the differences between these two jobs. This way, you can have a more realistic perspective on them.

Insurance Agent

An insurance agent is a sales professional specialized in advising on the various types of insurance coverage available in the market.

On the other hand, they also act as intermediaries between the person wishing to purchase an insurance policy - or needing advice on how to use their existing insurance - and the insurance company.

These professionals must be registered with the Special Administrative Register for Insurance Brokers, so their professional activity is protected under the Insurance and Reinsurance Mediation Law.

Real Estate Agent

As for the real estate agent, we can say that this is a professional specialized in the sale and acquisition of real estate.

They are responsible for expanding their contact list, managing the buying and selling of properties, showing them to potential buyers, and advising and guiding them through the transaction.

They also handle the necessary paperwork and processes involved in property transactions, taking into account the current real estate market, among other duties.

Is it more profitable to be an insurance agent than a real estate agent?

When choosing a new professional sector, it is common to ask about and be interested in the profitability of both professions. While both are known for high earnings, it is important to highlight that there are differences between them.

Commissions and Residual Income for Insurance Agents

Is it profitable to be an insurance agent? Working as a sales agent in an insurance brokerage has good financial benefits.

This professional receives a base monthly salary, which is also supplemented by commissions for each sale made, plus residual commissions. However, it is essential to mention that these commissions are not usually very high, though they may reach between 18-20% of the insurance amount. In some cases, a fixed commission is established instead of a variable percentage.

Furthermore, it is important to note that recurring client retention includes extra benefits. That is, when the insurance agent successfully formalizes a policy, they receive an initial commission, as well as residual income from each renewal of that policy.

This makes the financial situation of an insurance agent more predictable, and even stable, although maintaining relationships with clients generates more work.

Real Estate Commissions and Income

When discussing the profitability of being a real estate agent in Spain, it is important to note that, like insurance agents, they also receive a base salary and extra real estate commissions for each transaction completed.

An insurance agent may have a base salary ranging from €1,500 to €3,000 per month. However, this salary is supplemented with transactions that occur. These depend on location, the agent's experience, and negotiation skills. Still, these commissions are much higher than those of an insurance broker.

Another factor affecting real estate agent commissions is the value of the property. In this case, transactions are of high value, so commissions are also higher.

Belonging to Engel & Völkers, a brand expert in luxury real estate sales, will provide you with substantial benefits, as we have a network of over 800 branches in more than 34 countries.

These earnings, combined with the base salary, make it one of the most profitable professions in Spain, and more highly regarded than being an insurance agent. Although income may be less recurring, real estate commissions are undoubtedly higher and compensate for this.

Which profession offers more career development: insurance agent or real estate agent?

In addition to analyzing the profitability of both jobs, it is key to know which of the two offers more long-term professional development. This will help you choose the one that offers the best future prospects.

Career Development as an Insurance Agent

Insurance brokerages provide training for their sales agents, and even specific and necessary licenses to perform their work, issued by the Directorate-General for Insurance and Pension Funds.

They also have the possibility to specialize in specific areas such as personal, damage, or service provision, among others.

However, professional development is fairly limited, as you will generally always be part of a company.

Career Development as a Real Estate Agent

On the other hand, the real estate sector offers more adaptability, not only in terms of working hours but also in career development. You can work independently and even create your own real estate agency or personal brand to promote your services without needing a large investment.

Although formal studies are not required, at Engel & Völkers, we have an academy where you can train, and ongoing seminars in which you can update yourself to master the real estate market and become a successful industry leader.

Additionally, there is the possibility to specialize in specific types of real estate, such as luxury properties, locations, or market segments. Even with leading brands like ours, you can conduct transactions with international investors, which will help you develop your career in the real estate sector with higher commissions.

How are the clients and sales of insurance agents compared to real estate agents?

Additionally, to make a comparison of the profitability of these two professions, it’s useful to contrast the nature of the sales and clients in both sectors.

Insurance Clients and Sales

Insurance employees work with a larger number of clients, as the amounts involved are much lower than those for real estate transactions. Moreover, they need to care for and retain clients over the long term, offering them additional coverage in the future.

However, nowadays, there are many insurance companies offering similar services, so clients don’t make much differentiation between them. In fact, many brokerages work online, which makes establishing trust with clients - and maintaining it over time - more difficult.

Due to fierce competition, these professionals must put in a lot of effort to sell over the phone and meet monthly sales targets. As a result, many of these professionals state that it is a very stressful job.

Luxury Real Estate Clients and Sales

As for clients in the real estate sector, they are characterized by being less frequent and usually need more time to make a decision and complete the transaction. On the other hand, it is common for the relationship to end once the sale is completed.

However, luxury real estate agents stand out by forming closer relationships, due to the type of buyers and the higher value of the transactions. Therefore, it is more likely that clients will recommend you to other potential buyers or come back to you in the future.

Moreover, by establishing more personal and close relationships, the real estate sector becomes a much friendlier industry and is more enjoyable for the real estate agent.

As you can see, comparing the profitability of an insurance agent with a real estate agent shows some similarities. However, considering the value of sales and the type of client, we can conclude that real estate agents enjoy greater profitability in the commercial sector.

If you want to enjoy the profitability that this profession offers, all you have to do is join our team. Ready to start your career as a luxury real estate agent with Engel & Völkers?