The Federal Liability Risk Retention Act of 1986 clearly states that Risk Retention Groups are exempt from “any State law, rule, regulation, or order to the extent that would make unlawful, or regulate, directly or indirectly, the operation of a risk retention group.” Despite the clear directions, the National Risk Retention Association must occasionally send reminders when states make it difficult for non-domiciliary risk retention groups to do business there.

NRRA Executive Director Joseph E. Deems sent a letter to the Minnesota Commerce Department reminding the Department that it cannot treat a “notice of intent” to do business in the state by a “non-domiciliary” RRG the same as an application for a license and admission by a foreign insurer in Minnesota.  That the practice wrongfully results in very substantial delays by the department in responding to the RRG notice.

“NRRA has challenged Minnesota for its unreasonable delays in processing registration requirements,” NRRA chairman, Mike Schroeder said. “Minnesota has been taking actions tantamount to what’s done when an insurance company requests to be licensed and admitted. That’s wrong. All a RRG must do once they have been licensed and admitted in their state of domicile is to register to do business in a state, unless one of nine specific non-exempt categories are involved. The state’s actions in terms of charging fees and reviewing registrations is illegal,” he added.