Are Risk Retention Groups new?
A Risk Retention Group (RRG) is a federally created insurance company, typically formed in a captive friendly domicile. A RRG is a form of group captive and is a specialty class of insurance company owned and capitalized by its policyholders, which insures the risks of its owners. Insurance industry analysts estimate that up to 40% of annual commercial property and casualty premiums (totalling in the aggregate many billions of dollars annually) are written through captives and other similar alternative insurance market mechanisms. RRG’s are entities created under the Liability Risk Retention Act, which was enacted into law by Congress in 1981 and expanded in 1986 to respond to the unavailability and unaffordability of commercial liability insurance. There are currently 146 RRG’s and Forty-Two Percent of RRGs eligible for Ratings are Rated by A.M. Best.
