I receive a W-2 for my normal salary work as an insurance agent. I also get commissions on my customers that I bring into the office. I received a 1099-misc with the commission on the nonemployee compension line (#7). IS this where this needs to be. This makes me pay the self employeed tax. Should this be listed as other income since I am an employee of the payee?

It IS legal for your employer to pay you commissions under Form 1099-MISC, even though you are a regular employee on salary.