LLC?

[Allen Trent]

LLC provides basically zero protection to an insurance agent.

1. E&O covers claims against you if you screw up professionally.

2. You are personally indebted to the carrier for any chargebacks or debts you have to the carrier. Its part of the contract you sign.

So it provides no protection against lawsuits, because your E&O is your lawsuit protection.
And it provides no protection from the most likely creditor you will have as an agent.

* What it does provide is the ability to file taxes as an S-Corp and have a large amount of your income bypass self employment taxes. That is the main reason for an agent to form an LLC.

While I agree with your overall premise, especially for a 1 person business. However, the liability exposure of the building, property or employees would have protections if the business was run by an LLC. Slip & fall, automobile liability claim if staff person taking bank deposit or picking up supplies, employee injury, employee theft, employee identity theft, cyber liability,etc.

If any of those type of lawsuits, which have nothing to do with E&O of insurance sales, were over insurance limits or not insured, the LLC could be sued, but the individual potentially protected from the judgements of the lawsuits

 

[marindependent]

If any of those type of lawsuits, which have nothing to do with E&O of insurance sales, were over insurance limits or not insured, the LLC could be sued, but the individual potentially protected from the judgements of the lawsuits

We agree Sir. And I like the use of the word "potentially"

 

[Allen Trent]

We agree Sir. And I like the use of the word "potentially"

For sure. Seen many llcs collapsed in court hearings when a business operates many different llcs, but shares same check book, same employees & same equipment operating the different entities. All the added cost to created the extra entities can be collapsed when in court the judge determines the separate entities were merely an attempt to dilute liability. Need everything separate in those cases for sure