1. What is LIC Agent Commission?

LIC Agent Commission is the payment made to Life Insurance Corporation (LIC) agents for selling insurance policies. The commission is typically a percentage of the policy premium and varies based on policy type and duration.

2. How Does the Calculator Work?

The calculator uses the commission formula:

Where:

• Policy Premium — The amount paid for the insurance policy (in ₹)
• Commission Rate — The percentage rate agreed for the agent's commission

Explanation: The commission is calculated by multiplying the policy premium by the commission rate, then dividing by 100 to convert the percentage to a decimal value.

3. Importance of Commission Calculation

Details: Accurate commission calculation ensures agents are properly compensated for their sales efforts and helps policyholders understand the cost structure of their insurance policies.

4. Using the Calculator

Tips: Enter the policy premium in Indian Rupees (₹) and the commission rate as a percentage. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical commission rate for LIC agents?
A: Commission rates vary but typically range from 2% to 40% depending on policy type and duration, with higher rates for longer-term policies.

Q2: Are commissions paid annually or as a lump sum?
A: It depends on the policy. Some commissions are paid upfront, while others are paid annually as renewal commissions.

Q3: Do commission rates change over time?
A: Yes, LIC periodically revises commission structures. Always check current rates with LIC or your agent.

Q4: Are commissions taxable income for agents?
A: Yes, commissions are considered taxable income and must be reported by the agent.

Q5: Can policyholders negotiate commission rates?
A: Commission rates are typically set by LIC and not negotiable by policyholders.