If you are using a Launch method where the agent connects to the master, e.g. Java Web Start, then tick this box.

Each launch method tells Jenkins whether or not the Jenkins master can initiate the process itself or not. In the case of "passive" methods where the Jenkins master takes no action itself, Jenkins will be (mis)informed that it is unable to take action to start the agent.
This flag overrides that information.
This is appropriate for cloud-provisioned agents because the act of creating the agent (which the Jenkins master can do) should trigger the agent's connection.