With the industry focused on risk retention groups, little attention has been given to purchasing groups–the other entity enabled by the Liability Risk Retention Act.
In fact, the rise in PG formations since 2005 could be viewed as a reaction to a steadily softening market.
In contrast to risk retention groups, formed as insurance companies owned by their insureds, PGs are comprised of commercial insureds–of public and private entities–who band together to obtain liability coverage from admitted insurance companies, surplus lines carriers or RRGs.
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