California City to Require Liability Insurance for Gun Ownership

San Jose became the first known jurisdiction in the U.S. to require owners of guns to purchase liability insurance. If gun owners follow through, they will most likely acquire coverage, or potentially already have it, through their homeowners or renters policies, according to insurance industry officials.

After the city council voted June 25 to pass the new law, the San Jose mayor’s office touted the initiative as one way to reduce gun violence, as the ordinance also includes separate non-insurance related fee to be paid by gun owners to a designated violence prevention-oriented nonprofit annual fund.

Continued firearm violence spurs action by lawmakers

The rise in deadly violence, including mass shootings in the U.S., where 316 people are shot daily, 106 killed, and 90 are shot unintentionally but survive,has created an impetus to enact laws around gun ownership and liability, according to the advocacy group Brady United. 

Advocates and consumer groups in the gun violence prevention community applauded the new law as innovative and urged other cities to follow San Jose’s well-publicized example. The new ordinance goes into effect 180 days after adoption, so in about 6 months.  

According to the AP report on the new measure, a May 26, 2021 mass shooting of 8 people by a 57 year-old male employee male, who then killed himself at a nearby light rail yard spurred Mayor Sam Liccardo’s to take a broader plan of action to curb gun violence. 

The new law recited devastating statistics on gun injuries and deaths for the state and the nation, including the finding that having a gun in the home, no matter what kind or how stored, was associated with an increases risk of death by gun from homicide or suicide. More than 23,000  people in the U.S. die by suicide, 14,000 die by homicide, and almost 500 die from unintentional injuries from guns annually, according to language in the new law. 

No amount of insurance will buy coverage for criminal acts with firearms

However, insurance industry representatives have noted there are remedies within the system and that, in the vast majority of circumstances, no policy will be underwritten by actuaries to cover an illegal act. Most standard policies contain a liability exclusion for intentional and/or criminal acts and no insurance that will cover criminal acts is under development or foreseen, according to those in the personal lines insurance industry. 

Insurance was just not meant to cover criminal acts, and those meant to cause harm unless there are extenuating circumstances such has a home invasion or self-defense, say personal lines experts. 

There are no specific U.S. insurers that offer “separate, stand-alone gun liability coverage,” as the Insurance Information Institute states in a recent post.

Check current homeowners policy coverage

There is personal liability coverage for gun owners, but usually this is available through a firearms association, according to the Triple I. There does exist specific coverage for self-defense with a firearms in some policies, but it is rare the organization says. 

In the absence of such personal firearms-tailored policies, one’s homeowners insurance policies could cover damage from or loss of a weapon, including accidental discharge, so it is best to check with one’s agent if one owns firearms to check on coverage.  

In personal lines like homeowners’ policies guns are treated like other personal property. Thus, people can make claims for damage to or the loss of a weapon or the accidental discharge of a weapon,  according to Karen Collins, assistant vice president for personal lines for the American Property Casualty Insurance Association.

These kinds of incidents with firearms might be covered already under homeowners policies, while health insurance will cover an individual’s own medical expenses from a shooting, up to the policy limit, she noted through an email rom a spokesperson. 

New coverage is needed rather than new laws say insurance executives

“Some individuals view mandatory gun liability coverage as a solution to accidental discharges, negligent acts by gun owners, and thefts. However, new legislation is not necessary to accomplish this goal,” Collins said.  

Indeed, the ordinance's language itself points to locating this liability coverage in other personal lines insurance policies. It orders any person who lives in San Jose and owns a firearm must maintain a “homeowner’s, renter’s or gun liability insurance policy from an admitted insurer,” and says that these policies must cover damages from negligent or accidental use of a gun.

Enforcement of the new measure is as yet vague, and appears to be in the form citations, potential fines note yet set and other civil and administrative remedies.  

The California Department of Insurance did not return a query on the measure and its applicable laws.