All companies face liability issues. Therefore, business owners look for ways to reduce risks and control costs. In 1986, Congress gave companies a hand by passing a law approving a special type of insurance company focused on risk retention.
Special Insurance Companies
Risk-retention groups, or RRGs, are not required to have state licenses or follow state laws. These special insurance companies work with businesses or government agencies, who are members. All of the members in a specific group own that particular RRG.
Some of these insurers may become even more specialized types called captive insurers, but this is not the case with every RRG. The most important part of an RRG’s functioning is to protect the companies and government entities that are its member owners against liability risks while offering benefits such as reduced premiums.
RRGs offer particular advantages that might appeal to you based on your individual company’s circumstances. One such benefit is ease of control over loss protection. You can easily customize your protection package with an RRG, even obtaining coverage for areas that other companies may not insure. An RRG also provides stable rates over time.
Whether for businesses or government entities, RRGs make obtaining customized coverage for liability risks affordable. They offer options and possibilities, whatever your industry.