While the recent Government Accountability Office (GAO) report on risk-retention groups (RRGs) recommends that Congress pass legislation clarifying certain provisions of the Liability Risk Retention Act (LRRA), it doesn't go far enough, according to one industry expert.
In a report released Jan. 11, the GAO recommends that Congress consider "clarifying 1) whether RRG registration requirements beyond those currently specified in LRRA are permitted in nondomiciliary states (states other than the state in which the RRG is licensed); and 2) whether fees, in addition to premium and other taxes, could be charged to RRGs by nondomiciliary states in which they operate."
Fees and other requests by nondomiciliary states have been an ongoing issue—and they violate the federal act, according to the National Risk Retention Association (NRRA).
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