Comments on a Blog Post about Mandating Gun Insurance

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It’s hard to get thoughtful responses to the ideas published on this blog.  Most comments are from people who simply assert their, usually negative, conclusions.  When I get a response such as The Truth About Maryland’s recent post “Mandatory gun insurance: an interesting smart idea that won’t really work. A primer, from a finance and insurance geek,” I welcome the chance to look for new information or approaches to the problem of dealing with gun deaths and injuries.  Insurance is a tool and gun injuries are a problem that to be addressed by that tool require that it be specifically adapted to the problem.  For example, the parallels between automobiles and guns are striking because both are widely used instrumentalities that result in a substantial amount of death and injury; but this blog outlines differences in the best implementations of insurance.

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Questions and Answers on Mandating Gun Insurance.

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This post is a good place to start if you’re new to this blog. Scan the questions and follow the ‘Related:’ link(s) if you have an interest in a particular area.  You may also want to check the category’s listed in the right hand column. 

Q: What is the purpose of mandating gun insurance?

Required insurance for guns or gun owners should be designed to provide benefits for victims of gun accidents or violence. Insurers will automatically take appropriate steps to encourage gun safety as part of their loss control and underwriting activities.

Related: Insurance-Good for Victims, Safety and Gun Owners

Q: What specifically would be the best insurance system for guns?

Each state should adopt a system of no-fault insurance with a system of delivering medical and cash benefits directly to victims. This insurance should be required to be in place for any firearm brought into or kept in the state in order for that firearm to be legal. It should provide all of the benefits available to victims of motor vehicle or workplace injuries.

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Insurance-Good for Victims, Safety and Gun Owners

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We have responsible ways to handle things which are dangerous but which are not made illegal because of their actual or assumed benefits to society. We look carefully at ways to contain the dangers and enjoy the benefits in almost every case. The exception is firearms, but we are just beginning to pull our heads out of the sand and examine this important subject.

First Principle — Mandatory No-Fault Insurance to Cover All Victims

One of the most powerful tools to facilitate a dangerous activity is insurance. Unfortunately, requiring insurance to cover gun violence has been looked at only as a way to penalize gun ownership or at least to transfer costs to gun owners. The result is calls for high limit liability insurance, usually with terms that make actual implementation unlikely. This blog argues that the tort/liability model is one of the least effective ways to increase safety and provide for victims. A No-Fault system similar to worker’s compensation or some motor vehicle insurance is much better. It needs to follow a gun that changes hands in a way to insure that all guns are covered.

Second Principle — Top Down Insurance Does Not Require Gun Registration or Owner Tracking

This blog also is advocating that insurance be required of gun manufacturers or anyone bringing a gun into the system in such a way that the insurer only relinquishes responsibility when another insurer (contracted by a new owner) takes it up. Insurance should remain in effect through any transfer legal or not. This would allow confidence that insurance was always in effect without tracking the gun owners. With a proper No-Fault system the victim would not have to even be told the name of the owner to collect compensation. All transactions by claimants or the government would be with the insurance companies.

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Amar Kaleka for Congress with Gun Insurance in Platform

Amar Kaleka is a candidate for Congress from Wisconsin running for the seat now occupied by Paul Ryan.  He is the son of one of the persons killed by a Neo Nazi white extremist at the Sikh Temple in Oak Creek Wisconsin on August 5, 2012.  He has gun safety as a key issue in his platform.  Of particular interest to this blog is the third point on the “American Peace Plan for Gun Responsibility.”

3. Mandatory accidental discharge insurance on all gun sales and ammo.  When there is an accidental discharge and someone is harmed or victimized by an irresponsible gun owner, the burden of fiscal responsibility is left in limbo.  Private insurance carriers have the ability to determine the gun buyer’s biography, health, and criminal record.  Insurance companies and the market would decide reasonable premiums based on the type of gun purchased, carrying in public, or what type of training or the expertise of the gun owner.  The Federal government does not have this ability.

 

The announcement was made on August 30, 2014 in Santa Monica, CA with Richard Martinez, father of 2014 Santa Barbara shooting victim Christopher Michaels-Martinez; and Patricia Maisch, survivor of the 2011 Tucson, Arizona shooting.  It was picked up by Insurance News Net.

Limiting the mandate to accidental discharge makes the coverage much more narrow than the insurance advocated by this blog, but it is in line with many plans introduced in several states.  The argument that any insurance will cause insurers to take an interest in gun owners level of responsibility is probably a reasonable start.  The actual number of cases that insurers would have to pay would be small enough that it would end up being a very affordable coverage and is probably already covered by most homeowners insurance.

The fact that mandatory (but not so easily voluntary) insurance can cover intentional and criminal acts is not recognized; but in light of the widespread disinformation spread by insurers, it can be handled more effectively in full legislative hearing process than in an election campaign.

The point that insurers can do evaluations that the Federal government cannot is a good one.  The “Top Down” system advocated by this blog is based on that idea with a method of guaranteeing insurance for all guns without general governmental gun registration.

Gun Insurance Blog salutes Amar Kaleka for his courage and foresight in placing gun insurance in his platform in a clear and open manner.

How Should DC React to the New Gun Carry Decision?

The District of Columbia is scrambling to react to a Federal District Court decision that threatens to invalidate the ban on carrying guns for self-defense in DC.  The current law in accordance with the direct decision by the Supreme Court in Heller v. DC forbids carrying guns outside the home except by certain classes of armed professionals.  There has been a 90 day suspension of the application of this decision for an appeal which could be used to enact legislation which allows registration for that purpose.  If DC is required to allow individuals to carry guns in public there are various options in regulating such carrying that are in accordance with the recommendations of this blog.

They should certainly increase the level of responsibility that gun owners have if their guns result in injury.  They can pass provisions in the Municipal Code which are parallel to the specific requirements that give motorists a duty not to follow so closely as to strike other vehicles in the rear and a duty not to strike pedestrians in crosswalks.   There should be provisions in the DC Code to establish a duty, with a presumption of negligence if not followed, to avoid the following:

  • Allowing a gun to make an unintentional discharge.
  • Allowing a gunshot to strike an unintentional target or a person not intended to be shot.
  • Allowing a gun to get into the hands of an underage person or a person prohibited from possessing firearms.

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Precursors to Gun Insurance

Ideally, we should adopt a system of insurance that protects and compensates all of the victims of gun violence as a single well thought-out package.  The various terms would weight the balance between minimizing the interference with responsible peoples use of firearms and the need to keep them away from irresponsible people.  There are many factors that should work together to give the best overall results.  But, that isn’t the way that most systems of control and regulation are developed.  They come about incrementally.  Even before we adopt any requirements for ordinary gun owners and users to be covered by insurance, there are are changes that could set the state.  Insurance is a means of maintaining a system and culture of responsibility.  Keeping and use of firearms, unlike any other activity in our society, has accrued a large number of provisions, legal and of other kinds, to promote a culture of irresponsibility.  If this is rolled back in stages, use of insurance will emerge as a natural step.  It will be so because it will be a way of facilitating the responsible use of firearms in a context of demanded responsibility.

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Is Self-Defense Insurance Legal in California?

The National Rifle Association (NRA) and several other companies or organizations sell or sponsor the sale of insurance to defend and indemnify gun owners from liability in self defense situations.  They do this on a nationwide basis and promise protection in a wide range of situations where the purpose of the gun use is to defend ones person or property.  The point of this insurance is to have no restriction against covering self-defense as an intentional or willful act.  The question raised in this post is: How can this be possible under California’s Insurance Code?

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How Would Insurers Stop Straw Purchases?

One of the main feeders into the pool of illegal guns that cause a large portion of the deaths and injuries is those guns that are obtained through straw purchases.  A straw purchase is one that is done by a person with a clean record that can pass a background check to obtain a gun for a prohibited person.  For the purposes of this writing straw purchases are distinguished from other channels for guns to enter dangerous hands including:

  • Unchecked sales or gifts after the initial purchase
  • Theft of guns
  • Previously owned guns by persons who subsequently become prohibited persons
  • Guns used by persons who are not prohibited from having guns but who are clearly dangerous in hindsight

Straw purchases are the primary input to the “Iron Pipeline” which is the name that New York gives to the practice of buying guns in low regulation states such as Virginia and illegally smuggling them into New York for sale to prohibited persons.  The hate killing by a white supremacist in Kansas City in April, 2014 was with a straw purchased weapon.

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The Question of Pricing Mandatory Gun Insurance

In addition to policy arguments such as those against putting costs and responsibilities on the public or burdens on gun owners, the insurance industry has offered two major substantive arguments against mandating gun insurance.  The first, which is the claim that insurance does not and cannot cover, intentional or criminal arguments is simply false.  This has been extensively explored by this blog at the post entitled  “Gun Insurance for Willful, Intentional & Criminal Acts.”  The second argument is basically a “Chicken and Egg” objection.  They claim that insurers have no experience to price such insurance and that without ratings experience such insurance cannot be sold.  This post is to show the reasons that this objection is of greatly diminished importance in the case of mandatory gun insurance.

Why can’t insurers simply add up the losses that are occurring as they are reported by emergency rooms, as part of claims for various other kinds of insurance, media reports and government statistics and assign them different weights in an estimate?  The basic reason is that, with voluntary insurance, the people who will actually buy the insurance are not a representative sample of the risk exposed public.  Sometimes that works for the insurers advantage because people can buy insurance because they are more than typically responsible in many ways and produce fewer than average claims.  But those who know that they have an elevated risk can buy insurance for that reason as well. Continue reading

Mandatory Insurance for Armed Professions is Normal

We see armed people working around us on a daily basis.  Some of these private professionals are highly visible such as guards for banks and armored car services and some are less obvious to the eye such as private investigators or detectives.  In almost all states there are requirements for them to have licenses and in most states they must have insurance or bonds that function as insurance.  But there is tremendous variation in the requirements and in the definitions and terminology of the various roles.

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New Bill SB2646 for Gun Insurance in Illinois Covers Intentional

Illinois Majority Caucus Chairman Ira I. Silverstein has introduced a new bill (SB2656) in the Illinois General Assembly to require that gun owners have liability insurance.  This bill covers willful as well as accidental shootings by the owner or others.  It covers lost or stolen guns until they are reported.

This would be very helpful legislation if adopted as introduced and could form the basis of a more detailed and developed requirement to cover more victims.  Because it designates continued responsibility for unreported stolen guns it recognized the important of gun theft for supply to illegal gun possession.

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Voluntary Insurance and Strict Liability as Good First Steps

Much of this blog is about how insurance should be designed and how it would work if an ideal insurance mandate was in place.  Opponents of such a mandate point out real and imagined problems that would prevent such insurance from working.  When the possibilities are examined the problems turn out only to apply to particular models of insurance and can be avoided by designing the insurance for the particular nature of guns and gun violence.

But there are also transitional problems that could block adoption of an insurance mandate that would work well once it was in place.  The most important of these problems is the fact that gun insurance that would protect victims does not exist currently.  The insurance that is designed to protect gun owners from accidental or self-defense incidents is very narrow and is not adapted to the need to protect victims even to the extent that existing liability laws could allow the redress in the courts.

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