become an advisor

As An Insurance Agent, Should I Become A Financial Advisor?

Introduction The curve of your career depends upon the decision you make and the path you choose to continue. Over the decade, the finance and insurance market has grown enormously. While working as…


The curve of your career depends upon the decision you make and the path you choose to continue. Over the decade, the finance and insurance market has grown enormously. While working as an insurance agent for a long time, you may wonder what other career opportunities you can grab. If you have done your homework (in-depth research), a financial advisor is something; you find yourself familiar with. You are reading it here, finding an answer to whether you should jump for upgradation as a financial advisor and take your insurance agent career to the next level. 

Insurance Agent and Financial Advisor: What’s the Difference?

Financial planning is a major aspect of everyone’s life. Some are good at taking their own decisions, and some require help from a financial expert. People also reach an insurance agent to know different savings, investment, and refund options available in the form of insurance policies. Being an insurance agent, you may enjoy explaining and assisting your clients with investment-related policies. Do you want to make a recurring profit throughout your life without depending on the sale of the insurance policy? If you answer yes, then considering a financial advisor as a career option can benefit you. Before going ahead, understand that not all insurance agents are financial advisors and vice versa. 

What is an Insurance Agent?

As an insurance agent, you are the intermediary between a general or life insurance company and the client to sell insurance policies depending on the financial needs and life milestones of the customers. The insurance agent has a vast knowledge of insurance policies and expertise in suggesting a suitable plan that complements the clients' financial goals. 

What is a Financial Advisor?

A financial advisor is a person who provides financial and investment advice to an existing or a new client to help them make wise financial decisions. They help people to identify high-potential investment opportunities and manage their portfolios. The first role of a financial advisor is to consider the financial goals of an individual.  Later on, they use their knowledge about the investment market, economic trends, and regulations to make the right investments for insureds.

Is It Worth Switching to a Financial Advisor?

The career as an insurance agent is limited upto selling insurance policies, while as a financial advisor, you can open the doors to extended career opportunities in India. At the same time, you can suggest and sell insurance policies from different life insurance companies like term insurance, group insurance, investment plans, life insurance, retirement plans and others. The opportunities for insurance advisors are open, as anyone needing financial advice and planning can contact them. The worth of becoming a financial advisor can be discussed as

Employment Options: A financial advisor can join private or public firms, freelance, or be privileged to work from anywhere. They can manage their working hours best with their lifestyle and household demands to balance between personal and professional life. The following employment opportunities are available as a financial advisor

  • Job/self-employed advisor
  • Fee-only advisor
  • Commission only advisor

Unlimited Income Potential: An insurance advisor earns based on the commission on the policy sold, and a financial advisor has a great potential for earning from different job roles. The business is based on new and recurring business opportunities depending on networking. Initially, you will have to start from scratch while building your client base; later on, you can earn well. 

Flexibility: If you can guide your clients with transparency and help them make profitable decisions, you will ultimately earn the flexibility to work in your preferred hours. You can schedule your client meetings as per your allowances.

An Ideal Path to Build Start-Up: While the licensing and certification process is cheap, the chances to take your career to high levels are bright. Once you decide to switch from insurance agent to financial advisor, you can start your own business as an entrepreneur or work part-time along with your 9-5 job. The profits are worth the investment.

Niche Opportunities: The career as a financial advisor has different directions to opt for. Working with a firm, you can choose what products you are comfortable with while advising your clients (like investment, retirement, estate planning, education planning, etc.). You can make your career in the following 

  • Budgeting
  • Tax planning
  • Estate planning
  • Insurance
  • Saving and investing
  • College planning
  • Retirement planning

What Makes You Qualified to Be A Financial Advisor?

Every financial advisor is different. If you are working as an insurance agent, accountant, or analyst, you have great chances to develop the traits of a financial advisor and succeed. A financial advisor helps their clients with short-term and long-term goals like, budgeting, investment and saving, estate planning, retirement planning, and taxes; the following traits make you eligible to choose a financial advisor as a career opportunity. 

Excellent Communication and Interpersonal Skills: The key to a career like a financial advisor or POSP advisor, or insurance agent lies in building and expanding the network with people. You need to maintain the relationship with your clients, and hence you need to be able to build common ground with them. After understanding their financial requirements, you must carefully explain all the financial jargon to the clients to help them make an informed decision. Remember, Retaining is as important as building new relationships. 

Stress Management: A financial planner plays a vital role in managing the client’s portfolio, which majorly affects their future goals. Hence, you need to have the capacity to manage the pressure and stress, perform at exceptionally high levels, and avoid financial disasters (as much as possible). 

Analytical Skills: Each client has a different financial portfolio and hence requires a different level of planning. As a financial planner, you must have strong analytical and problem-solving skills to help your clients.

Enthusiasm: Your success becomes much more obvious when you love your job. You will plan the uncertain future of your clients and help them grow their wealth while making a profitable deal. Hence, it is essential to have passion while playing your crucial role as a financial planner or advisor. 

Organizational Skills: Time allocation is a golden trait that helps the financial advisor grow the clientele and income potential. Time management and organizational skills ensure the financial advisor serves their client well. 

Can I Become Financial Advisor Without a Degree?

Becoming an insurance agent with any life insurance company or insurance consulting agency like RenewBuy doesn’t require any higher education degree. An individual with the following basic eligibility requirement can become a POSP advisor or an insurance agent

  • He/she is 18 years or above.
  • He/she has a secondary-level (10th-grade) educational certificate.
  • He/she has attended the pre-licencing training by IRDAI and qualified for the Insurance Regulatory Exam. 
  • He/she has a license certified by IRDAI to sell a particular insurance category, whether life, general, group, or other. 

The role of a financial advisor is significant in planning the whole finances of an individual. Hence, one needs excellent knowledge of finances, economics, and taxes. Some companies may ask for a graduation certificate, while some may require a Master’s Degree in Finance. Every insurance or consulting company has different eligibility criteria; hence, you should carefully review the job description and requirements. All financial advisors need to register with the Security and Exchange Board of India (SEBI), and you can choose to become any of these two types of financial advisors.

Fee-Only Financial Advisor: The following requirements are necessary

  • Register as a financial advisor or RIA with SEBI.
  • Certifications such as Chartered Wealth Manager by the National Institute of Securities Markets (NISM).
  • CWM certification by AAFM India.

Commission-Only Financial Advisor: 

  • Insurance Regulatory Examination as mandated by the IRDAI (IRDAI IC 38)
  • Chartered Wealth Manager by the National Institute of Securities Markets (NISM)
  • CWM certification by AAFM India.

Final Words

You can start your journey with a direct-to-customer insurance consulting private limited as RenewBuy by partnering as a POSP advisor or insurance agent. Once you gain insurance product knowledge, you can get a good educational degree in finance, statistics, business, etc., and switch to start your career as a financial advisor. Remember that a financial advisor has more crucial responsibilities than an insurance agent selling life insurance or general insurance policies. Your work and perseverance can lead you to become a successful financial advisor. By now, we are sure that you must have got your answer to your question.

Learn how RenewBuy can help you take your first step and start your journey as a POSP advisor.


Last updated on