The National Rifle Association has agreed to stop soliciting insurance in California without a license, and made changes to its website and member communication materials to address allegations in a 2018 cease and desist order issued by the California Department of Insurance, Insurance Commissioner Ricardo Lara announced in early May.
The CDI issued the order in September 2018 in response to a consumer inquiry and subsequent department investigation.
The investigation revealed the NRA was transacting or selling insurance without a license or certificate of authority issued by the insurance commissioner, which violated the California Insurance Code.
According to the evidence cited in the department’s order, the NRA was soliciting sales of Carry Guard, a personal firearms liability insurance product providing coverage for bodily injury or property damage resulting from the legal use of a firearm in self-defense. The NRA sponsored Carry Guard, and received a fee for the use of the NRA’s name and trademarks from the licensed broker responsible for selling the policy.
The NRA used email marketing, featuring spokesperson Dana Loesch and NRA CEO Wayne LaPierre, to promote the product, explaining coverage details and articulating why the email target should buy the insurance coverage.
In one 2017 marketing email, NRA CEO Wayne LaPierre asked the recipient to “sign up for NRA Carry Guard today!” and urged them to “close this critical gap in your insurance coverage today, and I look forward to hearing that you’ve secured this important protection for you and your family.”
Because the NRA has never held a valid insurance license, the NRA’s marketing practices and messages are clear violations of California Insurance Code section 1631, as cited in the department’s Cease and Desist Order, according to the CDI.
Under the Stipulation and Waiver, the NRA notes substantial changes made to the Carry Guard website as well as direct mail and email materials to ensure they comply with the California Insurance Code and department requirements.
The Stipulation and Waiver further notes that, other than a banner advertisement from a licensed broker indicating the availability of insurance coverage, which redirects consumers to the broker’s website, the NRA site contains only information regarding the non-insurance benefits of the Carry Guard program.
The Carry Guard Personal Firearms Liability Including Self Defense Insurance Policy is administered by Lockton Affinity Series of Lockton Affinity LLC and underwritten by Illinois Union Insurance Co., a Chubb insurer.
“The NRA’s agreement to not sell insurance coverage affirms they will no longer violate California law by soliciting and negotiating insurance without a license,” Lara said in a statement. “Our laws are in place to protect consumers by ensuring that anyone offering insurance contracts has proper oversight by the Department of Insurance.”
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