This paper examines the extent to which state-level medical malpractice insurance market
conditions are associated with entry levels of risk retention groups (RRGs). We hypothesize
that medical professionals are a unique customer base and are well equipped to form
insuring organizations of their own in response to adverse conditions in the medical
malpractice insurance market. We find evidence that RRGs are more likely to enter markets
with higher medical malpractice insurance prices. In the course of our analysis, we also find …

… We find evidence that RRGs are more likely to enter markets with higher medical
malpractice insurance prices. In the course of our analysis, we also find … By way of
preview, our results indicate that the determinants of entry into medical malpractice
insurance markets are quite different from other insurer types. In particular, we find evidence
that RRGs enter markets where medical malpractice insurance premiums are high,
regardless of market profitability. This suggests that the RRG marketplace …