Laws Enacted for Required Gun Insurance NJ and CA

The first local laws have been passed to require gun insurance.  These are for liability insurance requiring fault by the gun owner or shooter and certainly don’t pay directly to victims or cover all guns.  But this is a start on a path that as it evolves will give good protection and promote safety. 

This has been posted on the Gun Insurance Blog YouTube site at: https://www.youtube.com/watch?v=cZrFX_aa0Xk

The script is below

                The first gun insurance requirements have been passed into law in the United States.  Let us celebrate the beginnings of a culture of responsibility around firearms.  Two separate jurisdictions at opposite ends of the country have launched on this long awaited return to sanity.       

This video looks at the new gun insurance laws in California and New Jersey.  What they cover, where they came from and where they’re going.

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                The first local laws to require insurance for gun owners will go into effect in 2023.  They have been passed and signed into law by the Mayor of San Jose, California and the Governor of New Jersey. 

San Jose requires gun permits but exempts those who have concealed carry permits, New Jersey’s new law only applies to those with concealed-carry permits. 

                You can see from this that it is only a step toward the insurance we need.  These laws take great care to avoid various kinds of potential interference with gun ownership.  The exceptions limit the usefulness and protection of the insurance, BUT this care proves that the objections of gun proponents are misguided.  As we learn from the new laws, we’ll find ways to make the insurance more effective. 

Insurance can be tailored to the requirements of a specific risky activity.  This is why it’s a powerful tool both to allow the activity and to mitigate the harm that results. 

                We need insurance that pays benefits to victims, applies without excessive delay and litigation, and which covers all guns.  This current baby step is important but it will need to followed by more steps that lead to the goals. 

                The ordinance in San Jose takes effect in January.   The Mayor, Sam Liccardo, thanked those who helped pass the ordinance  and “the many others who work tirelessly to help craft a constitutionally compliant path to mitigate the unnecessary suffering from gun harm in our community.”  The ordinance only covers accidents that involve firearms.  The city plan envisions that homeowner’s insurance will handle most cases with minimal changes.  That is, no-doubt, the reason excluding intentional shootings. 

Most homeowner’s policies have this exclusion and it would be a major disruption for insurers to require it to change.  Another factor is that there is no specific loss limit required, this would allow existing insurance to apply regardless of its limits.

                San Jose’s requirement does not apply to peace officers.  That is not unusual as police, even retired police, have been exempted from many gun laws.     Also exempted are holders of concealed carry permits. Both exemptions are somewhat illogical as the law isn’t aimed at preventing anyone from having a gun and it applies only to accidents.

                While the new ordinance in San Jose was passed in February 2022, its implementation was delayed by lawsuits from gun supporters.  Most of these have been dismissed and the law is to take effect.  Additional lawsuits are expected.

                The new law in New Jersey on the other hand covers those who have concealed-carry permits.  It was enacted in December 2022 and will take effect in July ‘23.  When he signed the bill Governor Phil Murphy said:

 “today’s law fully respects the Second Amendment while keeping guns out of the wrong hands and preventing them from proliferating in our communities.”       

As expected, lawsuits were immediately filed by gun proponents. 

New Jersey previously had a restrictive law allowing concealed-carry permits.  That law was struck down by the US Supreme Court.  Before in 2021 there were 870 concealed-carry applications, but the number is now expected to rise to about 11,000.  The insurance requirement is part of a new package which governs concealed carry in accordance with this decision.  Applicants for permits will have to demonstrate insurance compliance.

It calls for liability insurance and would only apply if the gun carrier is at fault.  The required insurance limit is $300,000.00  The governor’s statements show that he contemplates that homeowner’s insurance can meet the requirements; but, given the many limitations in typical policies, this will be complex.

These two new laws will launch a process that will require a substantial time to complete.  In addition to the inevitable court battles, there will be bills introduced and debated in other legislative bodies.  This process has happened in other areas before. 

For example, requirements for insurance for cars started in the early 1930’s and were not fully developed until the 1960’s.  In that case, the first laws in many states were “financial responsibility laws” which only required insurance for people who had already been unable to pay for the consequences of car accidents.  While the insurance industry has often claimed that a new requirement can’t be implemented, they have historically been able to adapt to whatever is needed.  They will do that now.

Both of the laws assume that most cases will be handled by some extension of homeowners insurance.  As gun insurance matures and adapts to the needs of supporting victims and providing gun safety, homeowners insurance may continue to play an important part.  The terms will need to be specifically defined to give coverage of all the possibilities and to allow the insurer to be protected from particularly dangerous persons and weapons.  In the less dangerous cases, it should not raise costs greatly.  There will be many situations outside the willingness of home insurance carriers to absorb the risks, and in these cases special insurance will need to be developed and priced. 

                Requiring insurance need not interfere with the safe use of an insured activity or thing.  We continue to drive with an insurance requirement, we work at jobs with workers compensation and we require insurance for many commercial activities.  In all of these cases the protection provided by the insurance mitigates the risks and reduces the need for tight regulation.  Insurance is both a means and a symbol of responsibility.  We need responsibility around firearms if we are to allow their existence and reduce their dangers.

Gun Insurance is Dead; Long live Gun Insurance

The agent Lockton and the underwriter Chubb have announced that they would cut dies with the NRA.  This may effectively end their Carry Guard insurance program, which is the insurance dubbed “murder insurance” by gun safety advocates.  This has happened less than two weeks after the tragic shooting in Parkland, Florida and illustrates the rate that changes can occur in a charged are such as gun safety.  Organizations Guns Down with Travon Martin’s mother Sybrina Fulton and Color of Change worked to bring this about.  When the time was ripe their efforts took effect.  Unfortunately, other organizations are currently selling insurance and quasi-insurance products of this type which are designed to protect gun users for legal responsibility for mistaken or over-zealous shootings claimed to be in self-defense.

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Reducing the Stock of Unwanted Guns—Insurance, Buyback and Amnesty

In a new article “Living on the Edge (of Austrailian Cities: Is Gun Amnesty Effective?” by Isabella Kwai, Adam Baidawi and Tacey Rychter, the New York Times questioned the usefulness of a new three month program to recover illegal guns in that country.

A 2002 buyback program in Australia is widely acknowledged to have removed most of the semi-automatic guns from private stocks, officially counting 659,940 newly prohibited weapons.  The Times article recognizes this program, pointing out that “the current rate of homicides involving guns in the United States is 23 times higher than it is in Australia” and that “Australia has not had a mass shooting since Port Arthur.”  Port Arthur was a very serious mass shooting that initiated the movement to adopt Australia prohibitions and the buyback program.  The buyback was a large program for a country of Australia’s size; and this amnesty will, no doubt, yield a much smaller reduction in the stock of illegal firearms.  But amnesty and other uncompensated programs are inexpensive and can be repeated over time.  The article linked above counts 219,721 additional firearms in uncompensated programs since the buyback.  This is a substantial reduction.

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Questions and Answers on Mandating Gun Insurance.

Featured

Updated 12/22/2022

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.

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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John Wasik Calls for Gun Insurance Again.

In a new article published Sept. 20, 2013 on the Forbes website and titled “Five Reasons Why Gun Insurance Can Survive Political Indifference”, he advocated for insurance as the most effective and practical solution to gun violence in more detail than ever before.  Wasik is a pioneer in pointing out the need for gun insurance starting well before the tragic incident at Sandy Hook.  His prior articles include:

February 15, 2011 in Reuters: “Why gun insurance should be mandatory

December 17, 2012:  “Newtown’s New Reality: Using Liability Insurance to Reduce Gun Deaths

December 29, 2012: “Gun Liability Insurance: Still a Viable Proposal

April 4, 2013: “Gun Insurance: An Economic Argument

His five reasons are:

1. Liability Coverage Addresses the Issue of Potential Future Harm Better than Any Gun-Control Legislation.

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PreventingNewtown Blog Points Out Gun Insurance Benefits

A new post by Julia Hartman on the PreventingNewtown blog titled “A Case for Gun Liability Insurance” gives a thoughtful and interesting discussion of the benefits of requiring insurance to protect victims of gun violence.

The post gives a moving presentation of the damage done daily by guns and calls for insurance as a way to deal with the problem.  It makes the comparison to motor vehicles and points out the fact that gun deaths exceed motor vehicle deaths in 10 states currently.  Suicides are handled on a par with homicides and accidents, an position which is often opposed by those supporting the status quo for gun policy.

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Article: Gun used to kill N.Y. cop came from Virginia

An article, “Gun used to kill N.Y. cop came from Virginia” published 1-26-13 in the Virginian-Pilot illustrates the kind of gun leakage from legal to illegal hands that insurance could discourage. Colleen Long writes that a robbery in 2011 resulted in the death of a New York City police officer, who was shot in the head. As our system for tracing guns that turn up in crimes relies on records kept by federal licensed dealers, the 9mm semi-automatic Ruger pistol was found to be sold legally in 1999 by a dealer in Colonial Heights, Va.

The buyer of the gun in that legal transaction said that the gun was in possessions he had packed but had ended up abandoning, when he was evicted from an apartment. The story linked above is interesting with more details.

One obvious question is, do we believe the story about the loss of the gun? A Ruger 9mm is not an especially valuable gun. According to firearmspriceguide.com a used one is worth about $200 to $400 depending on condition. A person being evicted may very well abandon a lot of stuff, so it could be true. But the gun did drop into illegal hands and end up in New York. If an insurance company had responsibility for for that gun that continued after it was lost, that insurer would have a strong incentive to require the owner to keep control of the gun. The value of the gun itself was not sufficient motive.

The laws of the State of New York couldn’t stop the gun from being illegally brought from Virginia. The laws of Virginia don’t insure that owner keep track of guns in a way that prevents their loss, illegal sale or abandonment. An insurance company on the hook would, no doubt, require the owner to periodically demonstrate that the gun was still under control. There would be some financial committment on the part of the owner, sufficient to convince the insurer that the gun would stay in legal hands.

This story is special because the victim was a police officer, which provided the motivation for tracing the gun and for the paper writing about it. Thousand of other killings with illegal guns are similar in many ways. As the article says 85% of the illegal guns in New York come from out of state.