North American Term Life Insurance Agent Commission Rates

How Much Commission Do You Earn Selling North American Term Life Insurance?

Agents typically earn between 30% and 50% of the first-year premium on North American term life insurance policies, with renewal commissions dropping to roughly 2% to 5% in subsequent years. The exact figure depends on the contract structure, the specific product, and the agent's arrangement with the carrier.

First-Year Commission Structure

North American Life and Accident Insurance Company uses a tiered commission schedule where higher face amounts generally yield higher percentage payouts in the first year. A 20-year level term policy with a larger death benefit often triggers a higher commission rate than a shorter 10-year term, reflecting the longer coverage duration and greater premium volume.

Renewal and Contingent Commissions

After the first year, renewal commissions are considerably lower but provide a steady income stream as long as the policy remains in force. Contingent commissions may also be available based on meeting production targets or persistency goals, though these are not guaranteed and vary by contract.

Factors That Influence Commission Size

• Policy face amount and premium size
• Term length (10, 20, or 30 year)
• Agent's appointment type and contracted agreement
• Whether the policy is filed directly or through a general agency
• Annual premium volume and production goals

Commission vs. Contingent Compensation

Beyond base commissions, some arrangements include contingent bonuses tied to overall book performance. These are separate from the base commission rate and depend on the specific agreement between the agent and North American.

What This Means for Your Earnings

A single mid-size term policy might generate a few hundred dollars in first-year commission, while a larger policy can yield several thousand. Because renewal commissions are modest, building a volume of in-force policies is essential for sustained income.