What is the primary function of a purchasing group?

The primary function of a purchasing group is to enable its members to collectively buy liability insurance under the provisions of the Risk Retention Amendments of 1986. This legislation was established to allow groups of similar businesses or organizations to pool their resources and risks, enhancing their ability to obtain insurance coverage while potentially lowering costs. By forming a purchasing group, members can leverage their collective bargaining power to secure policies tailored to their specific industry needs, often at more favorable terms than they could as individual entities.

While the other options may represent activities or benefits of insurance cooperation, they do not accurately reflect the core function of a purchasing group. Individual insurance coverage is typically provided to members, but the group's primary focus is on collective purchasing. Negotiating lower premiums can be a result of the group's efforts, but the essential function remains focused on collective buying under regulatory frameworks set forth by legislation like the Risk Retention Amendments. Acting as a regulator is not among the functions of a purchasing group; their role is specifically to facilitate purchasing rather than overseeing or regulating insurance policies.