Learn About Being a Financial Representative

Financial representatives are a new breed of insurance company sales people.
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Financial representative is a job title that is becoming increasingly common among leading insurance companies, especially life insurance companies. Though the particulars will vary somewhat from firm to firm, it essentially denotes an insurance sales agent who also acts as an investment broker and/or a financial planner.

Note that this and similar job titles also can be found in other financial services firms outside the insurance sector, such as mutual fund and discount securities brokerage giant Fidelity Investments, to cite just one example.

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Licenses and Certifications

The types of securities and investment products that a financial representative is permitted to sell depends on the FINRA licenses that he or she holds. Most typical are the FINRA Series 6 and Series 7 General Securities Representative licenses. In addition to insurance policies, one holding a Series 6 license can sell certain packaged investment products such as variable annuities and mutual funds. Selling a much broader range of investment products, including individual stocks and bonds, demands a Series 7 license, the same basic qualification for a financial advisor in a securities brokerage firm.

Within a given firm, note that some financial representatives may be Series 6 holders while others are Series 7 qualified. Accordingly, despite having the same title, among these producers there can be great variation in the menu of financial products and services that they can offer to their clients, as well as in their levels of knowledge and expertise.

Meanwhile, those offering financial planning services ideally should hold a Certified Financial Planner (CFP) designation, but a potential client should not presume that this is actually the case.

Prevalence of the Title

Some of the leading firms that use the financial representative title among their sales forces are Northwestern Mutual, John Hancock, Allstate, and Guardian Life.

Compensation

Compensation plans vary by firm and may be a mix of salary, incentive compensation (bonus) and/or commissions. Reflecting a growing trend within the financial services industry, financial representatives may be responsible for a host of expenses, such as for office space, equipment, marketing and sales materials. Such a trend already is established with respect to financial advisor pay. On the other hand, firms may cover such expenses and/or promise a minimum pay package for new hires in their first few years of employment in the field, to help them get established.

Finding reliable statistics on average pay is complicated by classification issues. Most notably, the federal Bureau of Labor Statistics does not report data on financial representatives. Their most closely-related job categories are financial advisors and insurance sales agents (follow the links for both above), as well as "Securities, Commodities, and Financial Services Sales Agents." For the latter, median pay as of May 2014 was $72,070 and 90% earned between $32,170 and $187,200. The lattermost figure was up from $166,400 in 2010.

According to the websites Indeed.com and Glassdoor.com, the average salary for a "Financial Services Representative" is around $50,000.

Glassdoor's figures are derived from rather limited sets of self-reported data from users of that website, and thus, cannot be taken as either comprehensive or authoritative.

Likewise, Indeed's figures are based just on current job postings in its system, and thus also are far from comprehensive. The average salary quotes in both sites also can be volatile, with ups and downs depending on current listings and user reports.

Not surprisingly, on the recruiting sections of their websites, leading insurance companies generally tout the pay of their top financial representatives (for example, the top 10%, top 1,000 or top 100) while being silent about average overall compensation, or average earnings for those in their first few years of service.

Alternate Spellings: Personal Financial Representative (the variation used by Allstate, for example)