Step #3: Meet the Legal Criteria

A. Choose an Entity

There are three broad categories to investigate when determining your business organization: sole proprietorships, partnerships and corporations. While sole proprietorships are the least expensive and easiest to create, they carry a risk of personal liability for the owners. Partnerships and corporations can afford further protection for the owners, but require more paperwork and cost.

B. Register with the County or State

All businesses in Maryland operating under an assumed ‘trade’ name must file an Trade Name Certificate with the State. Partnerships and corporations must file a Trade Name Certificate with the Maryland Secretary of State.  Check with your city or county court clerks to determine if a filing is required there as well.  

Maryland Department of Assessment & Taxation Checklist

C. Obtain IRS ID

The IRS requires a Taxpayer Identification Number for all entities. This number is used in the administration of tax laws. If your agency is organized as a sole proprietorship, your social security number is your tax identification number. If your agency is organized as a partnership or corporation, you are given a Federal Employer Identification Number (FEIN). 

Applying for a Federal Employer Identification Number

D. Apply for E&O

Prior to applying for an entity license with the Maryland Insurance Administration you will need to get errors and omissions coverage.

Since this is a new independent agency, and professional liability policies are on claims-made policy forms, your new E&O policy will have a retroactive date of the policy inception. In addition, since your agency is new and there is no previous information to reference, the E&O carriers will essentially have to underwrite you, as the owner, and your goals for the agency. E&O carriers will require a business plan and resume with all new applications. Insurance Brokers Service Corporation, IIAM’s for-profit insurance agency, is part of a national purchasing group providing E&O coverage to members through SwissRe/Westport and also part of a national program for Fireman’s Fund. For this reason, IIAM membership is required before your E&O application can be processed.

Errors & Omissions Insurance

Westport Insurance Application

Fireman's Fund Application

Helpful Hints

For information on IIAMD’s Errors & Omissions program, contact IIAM’s Insurance Administrator, Carla McGee, ACSR, RPLU.

The association is here to help members succeed. IIAM offers support through education, insurance market placement, branding, technical advice, and governmental advocacy.

IIAMD Membership Application

Membership Packet

Obtain Licenses

For sole proprietorships, a property and casualty license is issued to the individual; however, the individual must file a form to register a trade name under which he or she will be operating. For partnerships and corporations, the entity must have a separate license filed with the Maryland Insurance Administration.  Application for Maryland licenses are through the National Insurance Producer Registry or NIPR.  Keep in mind, this information is for Maryland only.  If you plan to sell, solicit or negotiate insurance in another state, a non-resident license will be required for that state in addition to your resident Maryland license.

Independent Insurance Agents of Maryland, Inc.
2408 Peppermill Dr. Suite A, Glen Burnie, MD 21061 | Ph: 410-766-0600 | Fax 410-766-0993

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