Risk Retention Groups RRG

In response to a hard insurance market in the mid 1908's, Congress passed the Liability Risk Retention Act of 1986. The legislation was intended to simplify the regulatory process for affinity groups such as doctors, real estate developers etc, who wanted to find an alternative to the and unavailability high cost of certain types of insurance coverage. The Act created two new legal statuses: Risk Purchasing Groups and Risk Retention Groups.

Risk Purchasing Groups are simply groups (individuals or companies) that want to join together to buy insurance at group rates. The Act prohibits states from placing certain restriction on these groups.

Risk Retention Groups (RRG) are insurance companies formed by an affinity group that enjoy an important regulatory status. Basically, the Act allows an affinity group to form an insurance company is one state (a sort of "home domicile") and be automatically qualified to do business in the other 49 states.

In theory an RRG only has to file with the states outside its home domicile:

* a plan of operation or a feasibility study which includes the coverage, deductibles, coverage limits, rates, and rating classification systems for each line of insurance the group intends to offer, and;

* a copy of the group's annual audited financial statement submitted to the State in which the group is chartered, and;

* a reserve statement prepared by a qualified actuary.

In practice, state bureaucrats have proven very difficult to subordinate. There have been numerous suits against various states that have thrown up impediments that seem at odds with the Act.

Wayne Walker
Principal, Windward Harbor LLC
© Windward Harbor LLC 2004
http://www.windwardharbor.com

---

A Life Insurance Quote Became Reality

Life insurance quoteThank goodness John took his life insurance quote... Read More

Travel Health Insurance - Understand the Benefits

If you're planning an overseas trip, you need travel health... Read More

Family Health Insurance Plans - How to Find The Best Provider Online

Family health insurance plans typically need to offer more coverage... Read More

We Dont Need Another Broker: How To Get The Best Liability Insurance Rates Available

Some business relationships are forged through blood and friendship. When... Read More

Insurance and The Engineer

The world is no longer right when the two words,... Read More

Consumer Directed Health Plans

Most of you have heard about "consumer directed health plans".... Read More

Life Insurance Whole Life or Term Life - Find Affordable Life Insurance

Life insurance, whether you need term or whole life, can... Read More

Do I Need Travel Insurance?

In the United States health insurance, unlike many other countries,... Read More

Health Savings Account (HSA): What Happens to it When I Retire?

The Health Savings Account (HSA) is a great tool that... Read More

Why Buy Life Insurance?

Love. Yes, that's right. Love for your spouse, children, family,... Read More

Insurance Glossary of Terms

Assured - Those insured under the terms of an insurance... Read More

Choosing Long-Term Care Insurance

A little over sixty percent of the folks who reach... Read More

Health Savings Account (HSA): Useful for Women in Childbearing Years?

The Health Savings Account (HSA) is an amazing tool that... Read More

Life Insurance Basics

One of the most important things you can do as... Read More

Should You Have Higher Deductibles On Your Coverage?

What is a deductible? A deductible is the amount you... Read More

The Many Benefits of Travel Protection Plans

Many people purchase insurance thinking I want full coverage and... Read More

Saving on Auto Insurance: The Road to Reduction

The road to saving on auto insurance is something that... Read More

Hidden Ways to Cut Car Insurance

Consumers are countering rising gasoline prices and other vehicle operating... Read More

Life Insurance Careers

Do you like to spend all day being sitting around?... Read More

Insurance Credit Scoring: An Ethical Issue

The issue at hand is the use of a consumer's... Read More

Health Insurance Plans - Benefits to Different Plans & Providers

Health insurance plans vary in their coverage and prices. The... Read More

7 Sure-fire Ways of Reducing Your Home Insurance Premium

Home security improvement:All insurance companies will happily offer you a... Read More

All Auto Insurance is Not Created Equal!

Contrary to what you may have heard all auto insurance... Read More

Tips For Lowering Your Auto Insurance Quote

Do you have many claims? If so, you should do... Read More

Insurance for Car Wash Fundraisers

Non-profit groups in this day and age need to watch... Read More

Student Health Insurance - Is It Necessary?

As a young, healthy college student, it might be tempting... Read More

Avoiding The Potholes Of Car Insurance

Car Insurance is an issue that we all of face... Read More

Reducing Soaring Insurance Claim Costs

With the soaring rise in claims to insurers from their... Read More

Health Insurance Options for Entrepreneurs

One of the most important benefits employed people enjoy is... Read More

Tips for Buying a New Home

My wife and I recently purchased a new home in... Read More

Need Low-cost Temporary Family Health Insurance?

Many families will find themselves without medical coverage at some... Read More

Disability Insurance For The Long Term

Disability insurance covers you for an extended period of time.... Read More

Should I Buy Rental Car Insurance?

Rental car agencies have a menu of insurance policies they... Read More