• All About LIC Agents And Their Commissions

    Life Insurance
    • Premiums as low as Rs.17/day for sum assured of Rs.1 crore*
    • Claim up to Rs. 1,50,000 deduction under section 80C**
    • Choose between annual and monthly premium payment options

    In India, there are plenty of people who make a living as LIC agents. India’s largest life insurer Life Insurance Corporation of India (LIC) sells most of its insurance products through its agents. Unlike the private insurers in the industry, LIC does not primarily rely on bancassurance or corporate agents to push its insurance products. LIC’s network of individual agents is the largest in any insurance business in the country. In order to become an LIC agent, an individual has to clear an examination and undergo a specific selection process.

    LIC agents make money through commissions on the policies they sell to their clients. Commissions are calculated on the premiums paid by policyholders. There is a specific slab on the commissions that can be earned by policyholders. The commission they earn is not a one-time payment. Additional commissions can be earned as premiums are paid by policyholders for the subsequent years. Before we focus on the commissions that can be earned by LIC agents, let’s take a look at the process involved in becoming an LIC agent.

    How to become an LIC agent

    The primary responsibility of an LIC agent is to provide assistance to prospective buyers and help them choose the right insurance products suitable for their specific requirements. Anyone who has completed 18 years of age and passed their 10th standard can become an LIC agent. The steps involved in becoming an LIC agent can be listed as follows:

    • Step 1: Visit the nearby LIC office and check with the officials regarding the process involved in becoming an agent. The branch officials will provide you with the necessary forms to fill up.
    • Step 2: Once you have successfully applied for the position, you profile will be registered in the company’s agency portal.
    • Step 3: Upon registration, you must have to take 25 hours of mandatory agency training offered by the company. You also have the option to take this training online at your own convenience.
    • Step 4: Once your training is complete, you must take a pre-recruitment examination held by the insurance governing body Insurance Regulatory and Development Authority of India (IRDA).
    • Step 5: After you have successfully cleared your examination, you can apply for a license with the LIC.
    • Step 6: The company will verify your application and provide you with the appointment letter and identity card. This makes you eligible to be an LIC agent and approach prospective customers.

    Commissions earned by LIC agents

    The commissions earned by LIC agents are influenced by various factors such as type of policies, policy term, premium paying term, etc. The commissions earned during the first year of a policy will be significantly higher than the commissions earned during the subsequent years. Once a policy is issued, agents will earn commissions during the entire premium payment term. The tentative commissions that can be earned under different types of policies can be given as follows:

    Endowment plans

    Premium paying term 15 years and above 10 years to 14 years 5 years to 9 years 2 years to 4 years
    Commission for the first year (on premiums) 25% 20% 10% 5%
    Commission for the second and third year (on premiums) 7.5% 7.5% 5% 2.25%
    Commission from the fourth year onwards (on premiums) 5% 5% 5% 2.25%

    Money back plans

    Premium paying term As per plan 12 years
    Commission for the first year (on premiums) 15% 15%
    Commission for the second and third year (on premiums) 10% 8%
    Commission from the fourth year onwards (on premiums) 6% 6%

    Child plans

    Premium paying term 9 years and above 5 years to 9 years 2 years to 4 years
    Commission for the first year 10% 7.5% 5%
    Commission from second year onwards 5% 5% 2%

    Pension plans

    Premium paying term More than 4 years 2 years to 4 years
    Commission for the first year 7.5% 5%
    Commission from the second year onwards 2% 2%

    *In single premium pension plans, the commission is 2% of the single premium.

    In addition to the commission, LIC also offers various rewards and bonuses for its agents. These rewards are based on the performance of the agent, and it may vary from one individual to another.


    LIC has a long list of policies in its lineup. Choosing the ideal plan from this list may become hectic if you don’t have any understanding of various insurance terms. An agent can analyse your needs and provide valuable suggestions based on it. The commissions earned by LIC agents is a reward for the policy advice and service they provide to their clients. If you wish to make a career as an LIC agent, you may contact the company directly and enquire about the process. There are many agents who provide this service on a part-time basis in addition to their regular jobs. A career as an LIC agent may provide you with the flexibility you are always looking for in a job.

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