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I Just Got Licensed - How Do I Know Whether I Should Sell Medicare Supplements or Final Expense

I Just Got Licensed: How Do I Know Whether I Should Sell Medicare Supplements or Final Expense?

If you are new to receiving your insurance license, you probably have questions about which area you should focus on. Some insurance agents choose to focus on a particular aspect of selling insurance, like final expense plans or Medicare Supplement plans. Which should you focus on?


Know The Differences

Any insurance agent conducting research about viable markets will find that there are thousands of final expense and Medicare agent job openings and that’s because the senior market is an extremely popular business right now due to the number of individuals reaching age 65 every single day. Determining which type of insurance to sell, however, is not as easy as simply seeing that both are viable markets. There are four major differences between selling Medicare supplements and final expense and these include:

  • The selling environment.
  • The duration and size of commissions.
  • How long it might take an agent to become familiar with that particular type of insurance
  • The level of customer service needed to keep the client on the books.

You will find opinions everywhere throughout the insurance industry about which kind of offering is better to sell and which one can net more money for the agent.

The Similarities Between Final Expense and Medicare Supplements

There are currently major differences when it comes to selling Medicare supplement insurance and final expense insurance, but there are also just as many commonalities, including:

  • They both address the demographic between the ages of 50 and 80.
  • Both benefit from a fast sales cycle.
  • Both can be sold over the phone or in person.
  • Direct mail and telemarketing are great lead opportunities for both these types of insurance.
  • The plan options available within each type can be confusing for the consumer enabling you to be the consultant.
  • Neither requires a high school diploma or degree to sell.
  • Both can be very lucrative for agents who have a consistent lead source.

Commission Differences

The bulk of the debate surrounding whether or not it makes sense to sell final expense insurance or Medicare supplement has to do with commission. There’s no salary option for final expense or Medicare supplement unless you are captive with an agency. So you’ll depend completely on your own self-drive and first-year payments as well as your renewal commissions to support your lifestyle and pay for your leads.

Agents selling final expense often benefit from bigger upfront commissions and smaller residual commissions. The typical commission is 110% of the first year of premium. Medicare supplements, however, can cost 2 to 3 times the typical premium of a final expense policy. The average commission on a Medicare supplement policy is 20% on the first year’s premium.

 Residual income is one of the main benefits of selling Medicare policies overall, selling final expense gives you freedom now, but freedom comes later with selling Medicare supplements. The average earnings for a final expense agent is $600 per plan they sell within the first year.

Medicare supplements earn an agent an average of $360 per plan sold within the first year. The real benefit is when the medicare policy residuals catch up and pass a final expense sale, totalling $1,800 over time. An added benefit is medicare supplement business tends to be more stable with less lapses.


Pro Tip: Open the door with Medicare supplement policy that saves the client money. Use the savings to cross sell a final expense policy. Now you've doubled your income and your customer retention!

Sales Environment

The second major factor is whether the selling environment fits your personality. Those individuals who are looking for final expense are different from those who are looking to purchase additional Medicare coverage. Final expense traditionally targets lower income individuals who didn’t save for final expenses, while the Medicare supplement client targets a middle to upper income ranges.

Learning Curve For Policies

The learning curve for Medicare can vary immensely. Final expense is very easy to understand which makes it easier for your insurance clients to understand as well. Medicare has a variety of different plan options and this can be extremely confusing or even overwhelming. Medicare supplements, however, follow standardize plan options but do take more time to learn and sell.

Customer Service Expectations

The complexities of offering Medicare supplements and having to understand the entire  Medicare system in order to answer questions from a client can require a great deal of customer service to keep clients.

Final expense agents, however, don’t have to learn as much because life insurance is relatively unchanging and fairly basic. Even though life insurance stays the same, it doesn’t mean that you don’t have to provide customer service.

Depending on what your goals are for your business model, we would suggest that you sell Medicare supplements and cross sell final expense insurance.

Key Takeaways In This Article

  • Know your differences between final expense insurance and medicare supplements.
  • Be honest with yourself about the selling environment you fit best.
  • Understand which product will help you met long term business goals.

Over to You

We'd love to hear your thoughts in the comments below on:

  1. Which product did you decide to sell, final expense or medicare supplements?
  2. Which product do you cross sell the most?

If you have any questions, please leave a comment below. We will carefully read each one of them. Happy Selling!

About the Author Matthew King

Matthew King is a co-owner of TR King Insurance Marketing and partner at Independent Life Insurance Agent Association. When he's not creating processes, content, and developing SEO strategies, he likes to immerse in gaming with his wife and friends.