Home > Insurance Division > Surplus Lines > Risk Purchasing Groups/Risk Retention Groups > FAQs |
Frequently Asked Questions - RPGs and RRGs |
Risk Purchasing Groups (RPGs) > Risk Retention Groups (RRGs) |
Risk Purchasing Groups |
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What are New Jersey's requirements to form a purchasing group? |
There are no specific legal requirements regarding the legal structure of a purchasing group. A purchasing group can be any group of insurance buyers who come together for the purpose of purchasing liability insurance on a group basis. Many purchasing groups form as a non-profit corporation. |
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What must be submitted to become registered in New Jersey? |
After the purchasing group is formed, N.J.A.C. 11:2-36 et seq. requires that any purchasing group with members located in this state to submit to the following to the Department:
- A letter of intent to do business in the State of New Jersey;
- A completed registration application (PDF) and a Notice of Appointment (PDF), which designate the Commissioner as its agent for the purpose of receiving service of legal process;
- A non-refundable filing fee, payable to the Treasurer, State of New Jersey, in the amount of $100.00;
- A listing of current members or potential members;
- The policy forms and promotional material the purchasing group will be using;
- Policy Form Certification (PDF); and
- A listing of the individual(s) who organized the purchasing group and the individuals who are providing administrative services.
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Where should this information be sent? |
Attention: Surplus Lines Examining Office, Division of Financial Examinations, Department of Banking and Insurance, PO Box 325, Trenton, NJ 08625-0325. |
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What are the regulations and statutes that govern purchasing groups? |
- N.J.A.C. 11:2-36 et seq.
- N.J.S.A. 17:47A-1 et seq.
- 15 USC 3901 et seq.
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Does New Jersey accept NAIC registration forms for RPGs? |
No, we accept New Jersey registration forms only. |
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Are policy forms required to be submitted? |
Yes, policy forms are required to be filed for informational purposes only. Prior approval of policy forms must be obtained for those lines of insurance classified as commercial auto or medical malpractice. Additionally, if your classification of insurance includes commercial auto, you must notify the Department of such insurance, so that the Department can verify the MVC ID Code. |
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Are purchasing groups allowed to use non-admitted insurers? |
Yes, but they have to be on the eligible surplus lines list. |
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Risk Retention Groups |
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Who can form a risk retention group? |
The owners of a risk retention group must also be its insureds. Membership is limited to persons engaged in similar businesses or activities with respect to the liability to which they are exposed. |
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What are the registration requirements of risk retention groups? |
- A letter of intent to do business in the State of New Jersey;
- A copy of its certificate of authority or license authorizing it to transact business as an insurance company, certified by the state of domicile;
- A statement identifying the state(s) in which the risk retention group is chartered and licensed as a liability insurance company;
- The identity of those who organized the group or who will provide administrative services;
- The amount and nature of initial capitalization;
- The coverages to be afforded;
- The states in which the group intends to operate;
- A copy of its plan of operation or a feasibility study;
- A completed registration application (PDF) and a notice of appointment (PDF), which designates the Commissioner as its agent for the purpose of receiving service of legal process;
- A non-refundable filing fee, payable to the Treasurer, State of New Jersey, in the amount of $100.00;
- The group's most recent audited financial statement; and
- The group's most recent annual statement.
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Where should this information be sent? |
Attention: Surplus Lines Examining Office, Division of Financial Examinations, Department of Banking and Insurance, PO Box 325, Trenton, NJ 08625-0325. |
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What are the regulations and statutes that govern risk retention groups? |
- N.J.A.C. 11:2-36 et seq.
- N.J.S.A. 17:47A-1 et seq.
- 15 USC 3901 et seq.
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Does New Jersey accept NAIC registration forms for RRGs? |
No, we accept New Jersey registration forms only. |
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Are policy forms required to be submitted? |
Yes, policy forms are required to be filed as part of the retention group's business plan and/or feasibility study. Prior approval of policy forms must be obtained for those lines of insurance classified as commercial auto or medical malpractice. Additionally, if your classification of insurance includes commercial auto, you must notify the Department of such insurance, so that the Department can request an MVC ID Code which will be obtained during the registration process. |
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Any additional questions? |
Please call 609-940-7428 or 609-940-7430 to obtain assistance for specific issues not otherwise covered. |