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Chartered Life Underwriter (CLU) – Insurance Designation Requirements

By Mark Cussen

clu logoThe Chartered Life Underwriter (CLU) designation is the oldest financial credential in existence. The American College for Financial Planning in Bryn Mawr, Pennsylvania created it specifically for life insurance agents in 1927, and it’s been carried by insurance professionals ever since.

This credential is to life agents what the CFP (Certified Financial Planner) credential is to financial advisors. There is one important distinction, however, in that no comprehensive board exam is required to attain the CLU. In that sense, it may be somewhat easier to achieve than its counterpart.

Nonetheless, the CLU provides a comprehensive insurance-based education. Over 94,000 agents carry this designation for every major insurance carrier in the U.S.

Earning the CLU Designation

Who Should Earn the CLU Designation?

Any life insurance agent, broker, or wholesaler who decides to make a career out of selling life products should seriously consider becoming a CLU. With this credential, even stockbrokers, bankers, estate planners, and tax professionals can enhance their marketability and income by complementing their existing services with in-depth life insurance knowledge.

Benefits of Becoming a CLU

The American College states that CLUs earn about one-third more than their non-credentialed colleagues. CLUs are thoroughly trained to more effectively handle complex transactions related to business and estate planning, and can therefore provide a greater level of service to clients than other agents. Earning the CLU can also make an agent more attractive as a managerial candidate or sales trainer.

Costs of Becoming a CLU

The American college charges $599 per course in the CLU program, as well as a one-time non-refundable fee of $135 for beginning students. The total price of the curriculum is $4,927 unless the student has taken previous coursework that counts toward CLU requirements (e.g. select CFP coursework may transfer over).

Curriculum costs will increase for each course the student wants physically shipped to them and for any supplementary study materials they select. Alternatively, the American College offers a “monthly pay” arrangement. Instead of paying for each course up front, professional students may enroll in a 3 year track and pay $135 on a monthly basis. The difference between this and the upfront costs are minimal (i.e. no interest is charged), and thus may be the best course of action for the committed student.

CLU Responsibilities

CLUs must complete 30 hours of relevant continuing education coursework every 2 years and submit it to the American College. They must also pay a biannual renewal fee of $200 for their designation and adhere to a code of ethics that has been prescribed by the American College. Those who have the ChFC designation can pay a single fee for both.

CLU Courses & Curriculum

Earning the CLU credential is now slightly easier than it used to be. It requires the completion of five core courses and three elective courses. The five required courses and elective options are:

Required Core Courses

  • Basic Insurance Planning
  • Individual Life Insurance
  • Life Insurance Law
  • Estate Planning
  • Business Planning

Additional Elective Courses (must be any three)

  • The Financial Planning Process
  • Health Insurance
  • Income Taxation
  • Group Benefits
  • Retirement Planning
  • Investment Planning
  • Applied Estate Planning

Each of these courses is generally equivalent to a 3-hour undergraduate college course. Although the American College is the original provider of coursework for the CLU, many colleges and universities now offer classes for the CFP designation that will count toward the CLU curriculum.

Each of the courses in the CLU curriculum comes with a final exam that must be passed before credit for the course can be awarded. But there is no comprehensive board exam that covers the entire curriculum after it has been completed. Once started, courses must be completed within five years, and all prospective CLUs must have at least three years of pertinent experience in the financial industry, such as with investments, insurance, banking, accounting, or taxation. They must also adhere to a code of professional ethics that places the client’s interests above their own.

Final Word

Earning the CLU designation is a major undertaking for most life insurance agents. However, many who do so reap major rewards from this achievement for the duration of their careers.

For more information on Chartered Life Underwriters and how to become one, visit the CLU section of the American College website.

Mark Cussen
Mark Cussen, CFP, CMFC has 17 years of experience in the financial industry and has worked as a stock broker, financial planner, income tax preparer, insurance agent and loan officer. He is now a full-time financial author when he is not on rotation doing financial planning for the military. He has written numerous articles for several financial websites such as Investopedia and Bankaholic, and is one of the featured authors for the Money and Personal Finance section of eHow. In his spare time, Mark enjoys surfing the net, cooking, movies and tv, church activities and playing ultimate frisbee with friends. He is also an avid KU basketball fan and model train enthusiast, and is now taking classes to learn how to trade stocks and derivatives effectively.

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  • Mandy

    Mark, I’m incredibly interested in pursuing this course of study. Any words of wisdom?

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