Having equity in PC agency (not licensed)

Aug 11, 2019

  1. ML21Financeguy
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    ML21Financeguy New Member

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    Have life/health/series 7/66/24

    I own an independent financial services office, a proposal came to me to open a P&C agency using my office space.
    I'd split the revenue as a profit sharing plan, I would not receive actual commissions.
    Do I need a p and c license?

    I will not be soliciting or talking with clients, simply profiting on a quarterly basis the profit from the agency P&L
     
  2. Markthebroker
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    Markthebroker Guru

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    What exactly are you receiving money for? You weren't clear, but if I read your post literally than you are just renting space as a landlord, and the answer is likely no.

    If you are receiving $$$ for something more, then you are basically receiving commissions. You can call it something else, but that's what it is.

    It's going to come down to your involvement with the money coming in.

    I've gone way down the rabbit hole with this with my llc, partnerships, referrals, consulting with an attorney.

    Either way, check with the DOI and you'll have your answer. They have the final say.
     
  3. Allen Trent
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    Allen Trent Guru

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    If the profit sharing will be tied the number of new policies or the premiums, you will definitely want to be PC licensed. Now, if you are merely a shareholder in the legal entity, you likely don't need a license.

    You will need to get approval from BD if you have one & disclose it on your FINRA/SEC paperwork for the outside income, etc. May also need permission from your securities clients to share their info or to merely market PC to them. I know tax prep businesses have to get signed permission each year of the tax preparer will also be contacting them about PC or Life or Annuity, etc
     
  4. adjusterjack
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    adjusterjack Guru

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    You really need to be studying up on your state's licensing laws. The agency itself may need to be licensed in addition to anybody deriving monetary gain from the sale of insurance, whether directly or indirectly.
     
  5. BADTROUT
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    BADTROUT Guru

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    It's not worth even the time to research it... just get licensed.
     
    BADTROUT, Aug 13, 2019
    #5
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