New York State Regulator says the National Rifle Association’s Carry Guard program Unlawfully provides Liability Insurance to Gun Owners for certain Acts of Intentional Wrongdoing.
New York Financial Regulators on Wednesday said an Insurance program for Members of the National Rifle Association (NRA) Violates State Law, and have imposed a $7 Million Fine on the Broker, Lockton, who Arranged it.
The NRA program allows Policyholders to Buy Policies that cover Legal Costs in Self-Defense Shootings. The “NRA Carry Guard” program is still being Marketed, according to the program’s Website, although Sales in New York were Suspended last Fall shortly after the State’s Department of Financial Services launched its Probe.
The Program also includes a Safety Training Program. Those who Purchase the Program also receive a Free One-year NRA Membership. The Insurance promises to Mitigate the Financial and Legal Consequences that might arise from Armed Encounters, even if the Member did everything right.
The Settlement with Lockton is the first in what is a Broader Investigation by New York Regulators that is also looking into the involvement of Chubb, Lloyd’s, and the NRA, in Insurance Programs for NRA Members.
The main NRA program of concern in New York, Carry Guard, is Underwritten by Illinois Union Insurance Co., an Excess and Surplus Lines Carrier Subsidiary of Chubb Ltd. Lockton Administered it through its Lockton Affinity Subsidiary, which is a Licensed Excess Line Broker in New York.
New York Department of Financial Services (DFS) Officials determined that some of the Coverages themselves and Limits are not Permissible under the State’s Law:
- The NRA is Not a Licensed Broker in the State, yet Lockton Paid the Group Royalties and Profit-Sharing.
- The Tying of the Insurance to a Free Membership valued at more than $25 is Illegal.
- Lockton Affinity neglected to obtain the Necessary Declinations from Standard Markets on Policies placed in the Excess and Surplus Lines Market.
As for the Coverage, the DFS said the Carry Guard program “improperly provided” coverage in any Criminal Proceeding against the Policyholder including Coverage:
- For Bail Money
- Premiums on Bonds
- Attorney Consultation Fee
- Retainer Expenses
- Expenses Incurred for the Investigation or Defense of Criminal Charges
- Costs Taxed against the Insured or the Insured’s Resident Family Member in a Criminal Proceeding arising out of a Shooting
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