Gun Liability Insurance Not Feasiable


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Solo
April 22, 2013, 04:53 AM
The Insurance Journal explains why gun liability insurance cannot work. (http://www.insurancejournal.com/news/national/2013/04/10/287849.htm)

Wherever these proposals surface, insurers have been telling lawmakers that such approaches would not only violate basic insurance principles but also be unworkable.

“Though well intentioned, such proposals misunderstand a fundamental principle of insurance—that it is designed to cover fortuitous, or accidental events; not intentional conduct. Property/casualty insurance does not and cannot cover intentional behavior such as criminal acts,” said Willem O. Rijksen, vice president of public affairs for the American Insurance Association.

According to Jimi Grande, senior vice president of federal and political affairs for the National Association of Mutual Insurance Companies, gun liability insurance measures would neither deter violence nor help victims.

“Liability coverage is designed to protect against accidental damages, most of which involving guns would be covered under a homeowner’s insurance policy. While some policies may provide coverage for liability stemming from the intentional use of a firearm for defensive purposes, no liability insurance product covers intentional acts of malicious violence, whether committed with a gun, a car, or any other instrument that is used as a weapon to deliberately harm people,” said Grande. “It is inconceivable that any insurer would offer such coverage, either as part of a homeowners or renters policy or on a stand-alone basis.”

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TheSaint
April 22, 2013, 04:55 AM
On top of all that, according to one article I read, in NY alone, where one legislator was proposing a minimum $1 million dollar policy per gun, that would make your yearly premiums $2600! Talk about a poll tax when you try to mandate insurance that costs five times as much as your average pistol.

AlexanderA
April 22, 2013, 05:54 AM
Liability insurance could, at most, cover claims arising from negligent use of a gun. What these legislators are talking about, in effect, is the posting of a "peace bond" that would be forfeited in case of intentional misuse of a gun. Let's say the amount was set at $1 million (per gun, per owner, or whatever). That would mean placing a lien on property worth at least that much, or else paying the standard 10% premium to a bondsman, which would amount to a nonrefundable $100,000 per year, out of pocket. Either way, this would confine gun ownership to the very wealthy, and would thus be a clear violation of the 2nd Amendment.

Criminals would pay no attention to this. Formerly law-abiding gun owners would have the choice of turning in their guns, or becoming criminals themselves. Any legislator proposing such a scheme is either crazy or grossly ill-informed, and rightfully should be turned out of office.

SharpsDressedMan
April 22, 2013, 07:27 AM
I expect insurance companies to JUMP on any new gun insurance. From a broad view, very few guns/gun owners get into an occurrence that would require a payout, and the vast majority would just be paying for insurance that never needs a payout. Isn't that how insurance companies make a profit?

19-3Ben
April 22, 2013, 07:48 AM
Well, there's also another issue at play here. If the insurance is mandatory, then the net effect is that someone's ability to legally exercise their right is decided by the insurance companies. If the insurance companies decide not to issue me a policy for whatever reason, then I cannot legally own a gun. It puts WAY too much power in the hands of those corporations.

Sheepdog1968
April 22, 2013, 10:46 AM
I don't think liability insurance such as an umbrella policy is a bad thing to have in general it covers you for all kinds of things However, 1 million per gun would be excessive. If they aren't careful, it will get challenged as a poll tax in trying to limit folks ability to exercise their constitutional rights.

Vector
April 22, 2013, 11:24 AM
Well, there's also another issue at play here. If the insurance is mandatory, then the net effect is that someone's ability to legally exercise their right is decided by the insurance companies. If the insurance companies decide not to issue me a policy for whatever reason, then I cannot legally own a gun. It puts WAY too much power in the hands of those corporations.

Another good point.

Vector
April 22, 2013, 11:28 AM
I don't think liability insurance such as an umbrella policy is a bad thing to have in general it covers you for all kinds of things However, 1 million per gun would be excessive. If they aren't careful, it will get challenged as a poll tax in trying to limit folks ability to exercise their constitutional rights.

I hope you are not proposing it should be mandated on any level. Sure an individual could decide they want to pay some type of coverage as a precautionary measure, but that is their choice. It is akin to choosing to have a gun safe. However gun ownership should not be contingent on it.

JRH6856
April 22, 2013, 12:33 PM
The proper term for what is being called "Gun Liability Insurance" is "Surety Bond". A surety bond is a promise to pay one party (the obligee) a certain amount if a second party (the principal) fails to meet some obligation, such as fulfilling the terms of a contract. The surety bond protects the obligee against losses resulting from the principal's failure to meet the obligation.

A bail bond is a form of surety bond where the obligation is to appear in court at the required date and time.

In the case of firearms, the principal's obligation is to obey the law regarding the possession and use of the bonded firearm(s) and the obligee is the person or persons damaged by the illegal use of the firearm(s).

A surety bond is generally guaranteed by a bonding agent which may be an insurance company. The bonding agent will require an up front posting of cash or other security. As with insurance, the amount required up front will be dependent on the bonding agent's calculation of risk having to pay the bond and may require the principal to post the full amount of the bond plus a premium.

While liability insurance is not a feasible vehicle for this purpose, a surety bond is the perfect vehicle. The question is whether or not it is a 2A infringement to require such a bond.

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