Why is a P&C License Needed?

You and Salty will each carry general liability insurance, and errors & omissions insurance, in line with industry standards during your participation in the Salty Program and for a year afterward. Each of us may ask to supply proof of insurance to the other to assist in compliance auditing or reporting. If you need, we can suggest coverage amounts and/or assist in procuring this type of coverage.

Auto dealer groups usually set up a limited liability entity to receive payments that accrue as a function of the group’s participation in our Embedded Insurance® program.

Generally, we recommend a simple single-member LLC entity. This limited liability entity will fulfill your entity licensing obligations, receive payments from Salty, and make onward transfers (subject to certain restrictions guidelines below).

Certain states have additional processes for name approval and naming requirements, prior to filing.

We suggest you work with your regular legal representative to discuss structures and that they refer to your state’s insurance department and Secretary of State’s office.

Please send a W-9 with the legal name and tax ID of the limited liability entity which will hold an insurance license(s) to Salty once established.

To receive payments from Salty as a result of insurance-related activity, the dealer group LLC is required to hold a resident business entity license for Property & Casualty insurance in the relevant jurisdiction. The business will hold licenses consistent with the personal licensing of one or more member offices.

This first requires that an individual is licensed. Typically auto dealers will appoint an officer to the dealer group LLC who holds a personal license for Property & Casualty insurance in the relevant jurisdiction. The officer that you nominate to the LLC entity will be required to sit and pass the pre-licensing examination test only in their state of residence.

Both the business entity and the nominated officer require non-resident licenses for the states of residence of your customers. For example, if you are based in the middle of a large state, you will likely only require licensing in that state, but if you are in a city such as Cincinnati, your customers may come from Ohio, Kentucky, and Indiana. Obtaining non-resident licenses is an administrative process that does not demand additional exams.

Business entity licensing can be completed administratively once the nominated officer is appropriately licensed. No additional examinations are required for this process.

CSC Global manages Salty’s LLC & Licenses for all 50 states – we recommend you to work with them regarding multiple state compliance. Click here for more information.

Accounting & Reporting Policies

Regulatory requirements of the insurance industry in all US states and territories mean that our distributor partners are not permitted to pay commissions as an expense item from the LLC entity to staff members or dealership entities that are unlicensed. However, patronage dividends may be remitted via P&L transfer within the dealer group.