Insurance broking in Australia can be a wise career choice, especially for those seeking a long-term, sustainable career. Since many individuals and businesses will need to mitigate risks, there will generally be a healthy demand for your services and the insurance products you offer.
Although anyone can find and research insurance policies online, the need for that “personal touch” remains. Business and people still rely on licensed and skilled insurance brokers. They’ll need someone like you to navigate the complexities of insurance and explain the terms of the policies to them plainly.
So, how do you become an insurance broker in Australia? In this article, Insurance Business provides the information you need to start your career. We’ll answer critical questions you may have, such as:
An insurance broker is a licensed financial adviser. The main function of an insurance broker is to serve as an intermediary between clients and insurance companies. It’s their job to assess clients’ insurance needs, then do the research and find the insurance products that best suit these needs.
Key responsibilities of insurance brokers include:
Insurance brokers Down Under must have the minimum educational requirements to meet insurance industry standards and be eligible to apply for a broker’s licence. The educational and licence requirements are as follows:
It's a commonly held misconception that having a degree is part of how you become an insurance broker in Australia. This is simply not true. Anyone who wants to work as an insurance broker and launch a successful, long-lasting career does not need a degree. The minimum educational requirement is that of finishing senior secondary school, then taking additional courses for insurance broking.
As for the licensing requirements, you need the Certificate III in Insurance Broking from a training provider accredited by the Australian Securities and Investments Commission (ASIC).
Here’s a breakdown of the steps involved in how to become an insurance broker in Australia:
There is no formal education requirement past finishing senior secondary school. And while this level of education will suffice, some aspiring brokers may choose to earn a university degree. Keep in mind that this is purely optional. However, those who choose to earn a degree can benefit the most by taking the following courses:
These courses can give you early exposure to insurance terms and concepts, making it easier to learn the nuances and complexities of the insurance industry. Those who don’t wish to get a university degree can obtain a Diploma in Insurance Broking from accredited institutions like:
After earning this diploma, obtain the Certificate III in Insurance Broking at an accredited training provider. This course is in accordance with the ASIC's Regulatory Guide 146. Note that the Diploma in Insurance Broking also teaches you the necessary skills for applying at entry-level jobs.
Once you’ve completed your education, it’s advisable to choose an insurance speciality early on. This can help you obtain more specialised training and relevant work experience as you start your career.
The different types of insurance you can specialise in include:
To make it easier to choose and focus, consider your own interests and passions then match them with the appropriate type of insurance. Consider also the type of clients you want to service and work with. For example, if your passion lies in cars, then choose auto insurance.
The next step after obtaining the necessary education is to get the appropriate level of work experience. This is an essential prerequisite for getting the Australian Financial Services Licence (AFSL). You may earn this work experience by working for another licensed insurance broker.
An internship or traineeship at an insurance company will also suffice. If you choose to, you can also try out with the largest insurance companies in Australia. Your work experience must be documented when you apply for the AFSL. If you want to work as an independent insurance broker, you will need several years of work experience alongside a more senior, qualified insurance broker.
To legally operate as an insurance broker in the country, candidates must have the Australian Financial Services License (AFSL) from the Australian Securities and Investments Commission (ASIC). The process of applying for this licence can be rigorous. Candidates must demonstrate their skills, knowledge, and understanding of the legislation concerned.
The ASIC has several requirements for the licence, and they largely depend on the type of insurance aspiring brokers want to specialise in. You can go to the ASIC page detailing how to apply for the licence.
Take the time to study and understand the regulatory framework of the Australian insurance industry and the insurance market. It’s advisable that you get comfortable knowing the regulations set by the ASIC and other relevant sets of rules like the Corporations Act and the Insurance Brokers’ Code of Practice.
This step can be helpful in what’s known in the insurance industry as “building your book of business”.
A useful organisation for this is the National Insurance Brokers Association (NIBA) of Australia.
NIBA provides members with access to various networking opportunities, as well as professional development programs meant to enhance your career and foster your credibility in the industry.
Attend seminars, workshops, and take specialised courses to stay updated on industry trends, best practices, and new industry developments. Remember, the insurance industry is constantly evolving due to changes in market conditions and regulations.
With the constant changes, regulators and clients will have certain expectations. You will be expected to stay abreast of these changes and remain compliant, while also maintaining a level of competence when delivering your services.
Having a professional network is critical, especially for insurance brokers. This can help you forge valuable professional relationships with key people in peripheral industries. These include real estate agents, financial advisers, lawyers, and accountants. These professionals should comprise a significant part of your network, since they are highly likely to refer their clients to insurance brokers like you.
Establishing and maintaining relationships with them can be crucial to growing your business – just be sure not to overstep any boundaries.
To become a successful insurance broker in Australia, you must develop a particular set of skills. Here are some skills that you can learn and apply to your insurance broker practice:
An insurance broker must have excellent listening, verbal, and active listening skills. Having the ability to read non-verbal clues can be useful as well. These skills are important for brokers to:
Good communication skills enable brokers to simplify complex policy information into terms that customers would understand. Brokers with these skills will also foster better teamwork and inform everyone to ensure smooth running.
Strong customer service skills are essential to building and maintaining good client relationships. This involves applying active listening to their clients' needs and offering them insurance products that suit them. A broker with good customer service skills should be honest, professional, responsive and attentive.
An insurance broker must have the ability to understand new concepts quickly. This is especially necessary when learning about new insurance products, new terms, or new conditions.
Potential clients require detailed explanations about insurance products, so insurance brokers with in-depth information on their company's range of insurance options will benefit them. Quick-learning brokers can get familiar with how their policies operate, understand how to handle plans, and know how to troubleshoot problems.
Perhaps the most important skill for an insurance broker to have is patience. Along with persistence, this skill can help brokers overcome the less pleasant aspects of insurance broking, like rejection, for example. A broker who is patient and persistent bounces back despite setbacks and continues to provide good service.
A patient broker knows how to give hesitant or indecisive clients the time to figure out what they really want or need from an insurance policy, and trusts in the process, however arduous.
The most current data shows that an insurance broker Down Under can earn up to $85,809 annually, which is $7,150.75 per month or $1,787.69 a week.
Considering that the average worker’s salary in Australia is around $100,000 a year which is $8,333 a month or $2,083.25 a week, this is comparatively lower than average. However, a recent report revealed that many Australians would be content with earning at least $80,000 a year.
An interesting fact in that same report is that many Aussies polled were unaware that the average salary is now $100,000 a year.
Despite the average broker earning around $85,000 it may not seem like such a low wage.
Note that insurance brokers’ salaries will vary due to factors like the individual broker’s skills, experience, and location. Here’s a list of some of the places in Australia where insurance brokers earn high:
The highest-paying locations for Australian insurance brokers
|
City or location |
Annual salary |
|---|---|
|
Perth |
$117,090 |
|
Melbourne |
$110,301 |
|
Sydney Central Business District, NSW |
$101,746 |
|
Sydney, NSW |
$95,276 |
|
Brisbane Central Business District, QLD |
$86,460 |
|
Hurstville, NSW |
$84,421 |
Source: au.indeed.com
Whether the career of an insurance broker is worth the time and effort one needs to become a broker, and a successful one at that, depends on the individual.
Working as an insurance broker has many benefits, ranging from flexible working hours, the chance to work with all sorts of people, opportunities for career advancement, and high earning potential.
If you have passion for the job, love helping people and are patient, you are likely to succeed. The most passionate and dedicated professionals may even find themselves among the top brokers in Australia.
We hope you found this helpful and if anyone you know asks how do you become an insurance broker, please refer them to this guide. Let us know your thoughts about this in the comments.
