| Rule Number: |
25P037 |
| Title: |
Risk Retention Group Holding Company Systems |
|
Type:
|
Standard |
|
Status:
|
Adopted |
| Agency: |
Department of Financial Regulation
|
| Legal Authority: |
8 V.S.A. § 15(a); 8 V.S.A. § 6015; 8 V.S.A. § 6052(e) |
| Summary:
| The Risk Retention Group Holding Company System Rule sets out reporting, organizational and operational requirements for Risk Retention Groups (RRG) organized as holding companies. This update to the rule tells RRGs how to comply with changes made in Subchapter 13 of Title 8, Act 101 by Act 110 (H.659) of 2024. The amended statute permits exempting RRGs from certain filing requirements and requires certain terms in RRG management agreements, in each case based on Department rules. This update provides those rules. The update also explains what it means for a non-U.S. jurisdiction to "recognize and accept" a group capital calculation under 8 V.S.A. § 3684(m)(2)(D). Lastly, this update
provides administrative changes and technical corrections to the rule. |
| Persons Affected:
| The modification to the rule affects entities that are part of risk retention group holding company systems that transact business in Vermont. The modification to the rule also benefits consumers and the Department. |
| Economic Impact:
| The entities impacted by this rule are risk retention groups and other entities in a risk retention group holding company system. The economic cost of the modifications to the rule are anticipated to be limited because the filings and other compliance requirements to which this rule update relates are established in Subchapter 13 of Title 8, Act 101, as modified by Act 110 (H.659) of 2024. The updates to the rule set out criteria for exempting RRG holding company systems from a group capital calculation filing, which may result in lower compliance costs for entities exempt from filing. The additional required terms in cost sharing and management services agreements may impose additional cost. Changes to provide explanation and clarification of the statute and changes to improve the administration of the rule are expected to impose minimal additional costs. The updates reflect changes made in the NAIC accreditation standard and widely-accepted NAIC model rule, which benefits the Department. |
| Posting date: |
Oct 20,2025 |
