These media stories are not providing the entire story (as usual).
At face value, one would take away from reading this that the NRA was selling the insurance, that the insurance was illegal and unlawful, and covered acts of intentional wrongdoing, and that the NRA paid a $7 million fine.
When the truth actually is, it was Lockton Cos., LLC and its affiliate Lockton Affinity, LLC that were fined, not the NRA. The NRA advertised and marketed the coverage, but wasn't selling it. The insurance coverage is indeed lawful, and does not cover 'acts of intentional wrongdoing', but 'self defense'. The state of NY though, deems this coverage to be unlawful, and thus far they are the ONLY state that sees it as such.
The only real wrong was that Lockton did not perform their due diligence when placing the coverage. They needed to complete a form on behalf of each insured, that documents their attempts to obtain similar insurance from other insurance companies, and were declined. The laws that are in place to control any insurance, are written to help protect the consumers. And each state has their own 'Division of Insurance', which is supposed to help enforce that all sides of the insurance industry are staying within the boundaries of the laws, whether its personal insurance for your home/auto, your business, etc.
However, its difficult to determine who actually was impacted:
Quote:
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“DFS will not tolerate conduct by any entity, licensed or otherwise, in contravention of New York Insurance Law, especially when that conduct is such an egregious violation of public policy designed to protect all citizens,”
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What citizens were threated by these violations? Who was harmed? Insurance laws dont always protect the consumer, even though the DOI exists to do exactly that. These Divisions of Insurance do stack up very large fines against those who skirt the law, and ignorance is never an acceptable excuse.
I work in the commercial insurance industry, and have seen numerous incidents where insurance agents do exactly what Lockton did. All I can do is shake my head and hope the DOI audits those offices. I know that I have done my job and abided by the law.