How an insurance agency makes money

Sources

• Goosehead Insurance, Inc. Form 10-K for the fiscal year ended December 31, 2025 · Goosehead Insurance, Inc. (filed with the U.S. SEC), 2025
• State Farm reports 2025 financial results (news release, February 26, 2026) · State Farm, 2025
• The Allstate Corporation Form 10-K for the fiscal year ended December 31, 2025 · The Allstate Corporation (filed with the U.S. SEC), 2025
• The Progressive Corporation Form 10-K for the fiscal year ended December 31, 2025 · The Progressive Corporation (filed with the U.S. SEC), 2025
• Occupational Outlook Handbook: Insurance Sales Agents (pay for May 2025, jobs for 2025) · U.S. Bureau of Labor Statistics, 2025
• New York Insurance Law section 2324: Giving or receiving rebates or inducements prohibited · New York State Senate (Consolidated Laws of New York), 2014
• State Farm slows changes for agent contracts (June 26, 2026) · WGLT, public radio in Bloomington-Normal, Illinois, 2026

Every number

• 200 insurerssec.gov ·2025 · Goosehead represents over this many insurers (Item 1).
• $78.6Msec.gov ·2025 · Renewal commissions earned by Goosehead's own (corporate) offices, 2025 (MD&A).
• $28Msec.gov ·2025 · New business commissions earned by Goosehead's own (corporate) offices, 2025: commissions on policies in their first term (MD&A).
• 73.7%sec.gov ·2025 · Worked out: renewal commissions divided by renewal and new business commissions together, for Goosehead's own offices in 2025. Leaves out its franchise royalties and insurers' bonuses.
• $2,300/yearsec.gov ·2025 · Worked out and rough: Goosehead's total written premium in 2025 divided by its policies in force at the end of the year, rounded to the hundred. Most of its premiums are for homes.
• $2,300/yearexample (example number: Simplified example: one client's premium for a year on one policy, the same as in the independent agency.) · Simplified example: one client's premium for a year on one policy, the same as in the independent agency.
• 14%sec.gov ·2025 · Goosehead's average commission rate on new business premium, 2025 (Item 1).
• 12%sec.gov ·2025 · Goosehead's average commission rate on renewal business premium, 2025 (Item 1).
• 15%example (example number: Simplified example: the commission on a policy's first term: a base commission of ten percent plus new-customer pay worth five percent more. Allstate's 10-K describes pay of this shape; neither Allstate nor State Farm publishes its rates.) · Simplified example: the commission on a policy's first term: a base commission of ten percent plus new-customer pay worth five percent more. Allstate's 10-K describes pay of this shape; neither Allstate nor State Farm publishes its rates.
• 10%example (example number: Simplified example: the commission on each renewal: the base commission alone. Captive insurers don't publish their rates.) · Simplified example: the commission on each renewal: the base commission alone. Captive insurers don't publish their rates.
• 10–20%sec.gov ·2025 · Commission rates vary by insurer, state and kind of policy, and typically fall in this range (Item 1).
• $874example (example number: Simplified example, worked out: the household's premium times the new-business rate, plus twice the premium times the renewal rate.) · Simplified example, worked out: the household's premium times the new-business rate, plus twice the premium times the renewal rate.
• $805example (example number: Simplified example, worked out: the household's premium times the first-term rate, plus twice the premium times the renewal rate.) · Simplified example, worked out: the household's premium times the first-term rate, plus twice the premium times the renewal rate.
• 19,200 agent officesstatefarm.com ·2025 · State Farm's agent offices in 2025 (the release says more than this many).
• 27,400 agentssec.gov ·2025 · Allstate exclusive agents and licensed sales professionals in the US, 2025 (the 10-K says over this many).
• 40,000 independent agenciessec.gov ·2025 · More than this many independent insurance agencies sell Progressive's car insurance (Item 1, Agency Distribution Channel).
• 572,600 jobsbls.gov ·2025 · Insurance sales agents' jobs in the US, 2025.
• 63%bls.gov ·2025 · Share of insurance sales agents' jobs in insurance agencies and brokerages, 2025.
• 12%bls.gov ·2025 · Share of insurance sales agents' jobs held by self-employed workers, 2025.
• $322example (example number: Simplified example, worked out: a new home policy of the household's premium at the new-business rate.) · Simplified example, worked out: a new home policy of the household's premium at the new-business rate.
• $168example (example number: Simplified example, worked out: a car policy with a premium of fourteen hundred dollars a year, renewed at the renewal rate.) · Simplified example, worked out: a car policy with a premium of fourteen hundred dollars a year, renewed at the renewal rate.
• $276example (example number: Simplified example, worked out: a home policy of the household's premium, renewed at the renewal rate.) · Simplified example, worked out: a home policy of the household's premium, renewed at the renewal rate.
• −$131example (example number: Simplified example, worked out: a new car policy of fourteen hundred dollars a year paid one hundred ninety-six dollars of commission; cancelled after four months, the insurer takes back the eight months unused.) · Simplified example, worked out: a new car policy of fourteen hundred dollars a year paid one hundred ninety-six dollars of commission; cancelled after four months, the insurer takes back the eight months unused.
• $635example (example number: Simplified example, worked out: the four lines added up.) · Simplified example, worked out: the four lines added up.
• $345example (example number: Simplified example, worked out: a new home policy of the household's premium at the first-term rate.) · Simplified example, worked out: a new home policy of the household's premium at the first-term rate.
• $140example (example number: Simplified example, worked out: a car policy with a premium of fourteen hundred dollars a year, renewed at the renewal rate.) · Simplified example, worked out: a car policy with a premium of fourteen hundred dollars a year, renewed at the renewal rate.
• $230example (example number: Simplified example, worked out: a home policy of the household's premium, renewed at the renewal rate.) · Simplified example, worked out: a home policy of the household's premium, renewed at the renewal rate.
• −$140example (example number: Simplified example, worked out: a new car policy of fourteen hundred dollars a year paid two hundred ten dollars of commission; cancelled after four months, the insurer takes back the eight months unused.) · Simplified example, worked out: a new car policy of fourteen hundred dollars a year paid two hundred ten dollars of commission; cancelled after four months, the insurer takes back the eight months unused.
• $575example (example number: Simplified example, worked out: the four lines added up.) · Simplified example, worked out: the four lines added up.
• $38.4Msec.gov ·2025 · Contingent commissions Goosehead earned in 2025 (MD&A).
• $25nysenate.gov ·2014 · New York lets agents give merchandise or subscriptions worth up to this much (Insurance Law section 2324).
• $100example (example number: Simplified example: what a client asks you to take off the price.) · Simplified example: what a client asks you to take off the price.
• 85%sec.gov ·2025 · Goosehead's client retention, 2025: the share of clients with a policy twelve months earlier who still had one.
• 85%example (example number: Simplified example: the share of clients still with the agency a year later. This is Goosehead's figure for 2025, used here for a captive agency too.) · Simplified example: the share of clients still with the agency a year later. This is Goosehead's figure for 2025, used here for a captive agency too.
• $62,280/yearbls.gov ·2025 · Median yearly pay of insurance sales agents, May 2025.
• 2–3 yearssec.gov ·2025 · How long Goosehead's franchises take to ramp up their new business sales (MD&A).