What is a RRG?

A Risk Retention Group (RRG) is an alternative risk transfer entity created by the federal Liability Risk Retention Act (LRRA). RRGs must form as liability insurance companies under the laws of at least one state—its charter state or domicile. The policyholders of the RRG are also its owners and membership must be limited to organizations or persons engaged in similar businesses or activities, thus being exposed to the same types of liability. In Yellowstone's case, this would be Medical Professional & General Liability.  Most RRGs are regulated as captive insurance companies. However, RRGs domiciled in states without captive law are regulated as traditional insurance companies.  Yellowstone is domiciled in Vermont.

 

Benefits of RRGs include the ability of members to:

 

  • Control their own program

  • Obtain rate stability over the long-term

  • Implement effective loss control/risk management practice

  • Earn dividends for good loss experience

  • Have access to reinsurance markets

  • Maintain a stable source of liability coverage at affordable rates

  • Operate on a multi-state level