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RISK
RETENTION ACT WHY A
CAPTIVE/RRG? ∎ Alternative to trading dollars with
commercial insurers
in the working layers
of risk ∎ Gain direct access to re-insurers ∎ Design coverage tailored to
industry-specific and entity-
specific needs ∎ Accumulate investment income to help reduce
net loss
costs ∎ Improve cash flow ∎ Incentive for loss control + create industry
specific loss
control programs ∎ Gain greater control over claims and
litigation ∎ Underwriting and retention funding
flexibility ∎ Provide coverage where it is unavailable or
overpriced in the commercial
marketplace ∎ Premiums can be based on the experience of
the members vs.
the market in general or based
on the income and expense needs of an
insurance company ∎ Reduced cost of operation ∎ Reduced collateralization/capital
requirements ∎ Use of accumulated surplus to reduce costs
in the future |
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