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Risk Retention Liability Groups

Whether large or small, companies across the nation are faced with risks and exposures that open the possibility of financial ruin should a liability claim be filed. In order to address these challenges, the Federal Liability Risk Retention Act of 1986 was passed. The origins of RRG insurance are in direct response to offering affordable liability coverage.

Many companies are unable to afford liability insurance due to their size or limited earning, but Congress mandated that a marketplace be established to offer these professionals, businesses or municipalities access to coverage. This marketplace included establishing RRGs (risk retention groups) and PGs (purchasing groups).

RRG insurance plans spread the risk and costs associated with them between the members of those insured. It is a group self-insurance plan for commercial exposures. The exposures include:

  • General liability
  • Errors and Omissions
  • Medical Malpractice
  • Directors and Officers
  • Professional Liability
  • Product Liability


Although these are the bulk of the exposures faced by businesses across the nation, there are risks still associated with the physical location of the business and those employed with the company. These are addressed through property insurance or workers’ compensation coverage but aren’t included in most RRG policies.

It is best to speak with a commercial policy expert or broker for the most comprehensive way to address your company’s liability needs.

nms (Author)