The National Rifle Association’s disastrous Carry Guard insurance program, which has since ceased operation, has cost it tens of millions of dollars in fines and legal fees. The ill-conceived program wasn’t structured in such a way as to comply with insurance laws in many of the states in which it sold policies. That has resulted in fines, policy cancellations, lawsuits and even civil charges.

Yesterday, the NRA settled pending civil charges with the state of New York alleging they sold insurance there without a license. The NRA agreed to pay a $2.5 million fine and not to sell insurance products in the Empire State for five years.

From US News and World Report:

The settlement resolved charges over the NRA’s two-decade relationship with insurance broker Lockton Cos, including the sale of 28,015 policies to New Yorkers and the NRA’s receipt of more than $1.8 million in associated royalties and fees.

Linda Lacewell, the state insurance superintendent, said Lockton’s NRA-branded “Carry Guard” program illegally offered policyholders coverage for criminal defense costs and the “intentional” use of firearms in shooting incidents.

She also accused the NRA of misleading gun collectors, dealers, instructors, clubs and shows by promising coverage at the “lowest possible cost,” when the group typically kept between 13.7% and 21.9% of premiums paid.

All in all, the settlement is probably a win for the NRA. A $2.5 million fine is a relative pittance compared to what they’ve sunk into legal fees defending themselves against states like New York, Washington and others over sales of Carry Guard policies.

From 2000 to 2018, the NRA worked with the Lockton Affinity Series of Lockton Affinity, LLC to offer insurance products to NRA members, their families and affiliated businesses in New York. The NRA received “substantial” compensation, including royalties based on insurance premiums. That means the NRA acted as an insurance producer under New York law, requiring the organization to be licensed, according to the DFS.

As for agreeing not to sell any new policies in the state for five years, that’s not a problem. The NRA finally pulled the plug on Carry Guard over a year ago when it became evident how ill-conceived and how big a potential liability that albatross of a program was.

From the Washington Post:

“The DFS inquiry, which began with a roar, ends with a whimper,” William A. Brewer III, counsel to the NRA, said in an email. “The consent order contains no admissions by the NRA, and no NRA member money will fund this settlement.”

Uh huh. It’s not clear how paying the fine won’t involve any member dollars since money is fungible. Whatever the funding source, the NRA is no doubt only too happy to get this mess behind it as they continue to fight New York Attorney General Letitia James’ attempts to euthanize the Association.

The only winner in all of this has been — surprise! — the NRA’s ultra-expensive outside counsel William Brewer. That’s one scandal down and another dozen or so to go.


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