As the soft market slowly comes to an end, the high rate of survival for risk retention groups bodes well for the RRG marketplace.
While expectations for 2011 are not particularly high, the year has gotten off to a dynamic start with four new RRGs licensed in the first weeks of the year. Industry professionals are hopeful for the RRG market right now—more so now than they have been in recent years.
The early years of the last decade saw rapid growth in the number of risk retention groups which rose from only 65 in 2000 to a peak of 262 in 2008. In the following year, 2009, formations slumped and retirements soared, and the number of operating RRGs fell to 252. After so many volatile years of growth and shrinking, at the beginning of 2010, industry analysts were uncertain where the market would go.
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