NAIC RRG Flashcards
1
Q
Define an RRG
A
Risk Retention Group
* a liability insurance company owned by its members
* members are a group of similar businesses that have pooled their risks
* medical malpractice is the most common LOB
2
Q
Formation of an RRG
A
Formed using a combination of state & federal laws under the auspices of the Federal LRRA (Liability Risk Retention Act):
* must submit a plan of operation to commissioner of domiciliary state that includes coverage, deductibles, limits, rates, classification system
May be formed under a state’s captive or traditional insurance laws
3
Q
Operation of an RRG
A
- may write business directly in states where they are registered without obtaining a license (captives can’t do this)
- can be domiciled in 1 state but still do business in another state if a registration process is completed and the state’s commissioner is designated as agent for service of process
- treated as multi-state insurers and subject to NAIC accreditation standards for RRGs
4
Q
RRG financial filing requirements
A
- Financial statements (yellow book format)
- RBC
- SAO
- MD&A (Management’s Discussion and Analysis)
- Audited statements
5
Q
Regulatory differences between RRGs and traditional insurers
A
- many RRGs use GAAP instead of SAP
- few RRGs submit rate filings
- RRGs can’t participate in state guaranty funds