Risk retention groups and state insurance regulators have been at odds over state rights vs. protections of the Liability Risk Retention Act. Disputes include:

1995: Louisiana legislators pass a measure requiring RRGs licensed in other states to meet capitalization and surplus requirements before they can operate in Louisiana. A federal judge strikes down the law in 1996, which an appeals court affirms.

The 11th U.S. Circuit Court of Appeals upholds a Florida law requiring taxi and other passenger transportation firms to buy the first $30,000 of liability coverage from Florida Insurance Guaranty Assn. insurers. Under federal law, RRGs cannot be members of state guaranty funds or associations. An appeals court rules that the law was a legitimate extension of state authority.

2000: LRRA pre-empts Oregon laws that effectively bar auto dealers from selling vehicle service contracts and require them to purchase reimbursement policies from authorized insurer members of the state guaranty association, the 9th U.S. Circuit Court of Appeals rules. The court said the requirement was a categorical exclusion of RRGs, which cannot be guaranty association members under LRRA. The decision creates a split at the appeals court level.

Five years earlier, the 11th U.S. Circuit Court of Appeals came to the opposite conclusion in a somewhat similar case.

2001: A federal judge strikes down an attempt by Michigan insurance regulators to impose a fee of 0.5% on premiums written by RRGs licensed in other states for coverage they provide to Michigan policyholders. Michigan regulators say LRRA allows such a tax, but the judge said the assessment was a fee that LRRA pre-empts.

2007: California insurance regulators issue a cease-and-desist order to the Auto Dealers Risk Retention Group, a Montana-domiciled RRG, concerning medical stop-loss coverage. A federal judge later rules that as a nonchartering state, California lacks the right to regulate the RRG. The RRG stops writing the coverage, saying it cannot afford the cost of continued litigation.