We previously discussed corporate forms for insurance agents & brokers a few years ago in Corporate Forms for Insurance Businesses, and would like to add a simple summary of the different choices – see here. It appears unlikely that the preferred forms for insurance agents & brokers – either an LLC or S-Corp – will change. Both are pass through entities for tax purposes, although the LLC form provides for more flexibility.
The article, What Is the Best Legal Structure for Your Start-Up? (see here), provides a summary of each of the most popular corporate forms. Regarding outside capital, the article notes:
If you plan to seek capital from outside investors, such as venture capitalists, you likely need a more rigid business structure
This is not wholly accurate. Private investors including VCs will work with LLCs because of the flexibility in governance and capital structure.
Tennant Risk Services is a specialty wholesale broker and underwriting manager, and delivers expertise, markets and exemplary services to our retail insurance agent clients in the placement of professional liability insurance (E&O, D&O, EPL, Cyber). We excel at hard to place accounts.
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