diff --git a/management/server/peer.go b/management/server/peer.go
index b7b6d913b..5101a5133 100644
--- a/management/server/peer.go
+++ b/management/server/peer.go
@@ -756,9 +756,11 @@ func (am *DefaultAccountManager) AddPeer(ctx context.Context, accountID, setupKe
 				}
 			}
 
-			err = transaction.AddPeerToAllGroup(ctx, accountID, newPeer.ID)
-			if err != nil {
-				return fmt.Errorf("failed adding peer to All group: %w", err)
+			if !peer.ProxyMeta.Embedded {
+				err = transaction.AddPeerToAllGroup(ctx, accountID, newPeer.ID)
+				if err != nil {
+					return fmt.Errorf("failed adding peer to All group: %w", err)
+				}
 			}
 
 			switch {