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RISK RETENTION GROUPS
Q. What is a Risk
Retention Group? A Risk Retention Group is a corporate or limited liability
association which is a state chartered and licensed, group- owned (captive)
insurance company. Whatever
“insurance” is provided is group self-insurance. Q. What insurance
licensing and regulatory requirements must a Risk Retention Group observe? Depending on the requirements of the state in which a Risk
Retention Group chooses to call “home”, it must to some extent: ● Meet the capital and
surplus requirements for the types of insurance involved. ● Have managers and officers
that are not incompetent. ● Pay licensing fees and
post bonds as may be required. ● Maintain minimum premium
and loss reserves. ● Comply with that state’s
policy forms and rate practices. ● Participate in joint underwriting associations
along with other insurers licensed in the same state. ● Submit regular financial reports, submit to
examinations and comply with lawful orders. ● Pay the same premium and other kinds of taxes
imposed on other insurers similarly licensed in the state. |
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