May 2, 2018 / 5:21 PM / 7 months ago

New York regulators fine Lockton $7 million for selling NRA insurance program

(Reuters) - New York State’s financial services regulator said on Wednesday it has ordered Lockton Cos LLC and an affiliate to pay a $7 million fine for serving as the administrator of an insurance program for National Rifle Association members in violation of New York insurance law.

    The Department of Financial Services said the NRA does not have a license from the agency to conduct insurance business in New York. It said the NRA marketed and solicited for the “Carry Guard” program through a website, email, and direct mail.

    A DFS investigation found that the NRA Carry Guard insurance program provided insurance to gun owners for acts of intentional wrongdoing, and improperly provided insurance coverage for criminal defense.

    “DFS will not tolerate conduct by any entity, licensed or otherwise, in contravention of New York Insurance Law,” said Maria Vullo, DFS superintendent, in a press release describing a consent order the agency reached with Lockton.

    In a statement emailed by a Lockton spokesman, the Kansas City, Mo.-based firm said it will continue to cooperate with regulators. “We believe this settlement is the best way to resolve these issues.”

Insurance broker Lockton said in February it would no longer sell NRA-endorsed products.

    In addition to the fine, Lockton has also agreed to refrain from participating in the Carry Guard insurance program, or any similar program in New York and from providing Carry Guard or similar insurance policies for or to New York residents regardless of where they are written, the DFS said.

    Lockton had issued 680 Carry Guard insurance policies to New York residents between April and November 2017, the DFS said.

Reporting by Diptendu Lahiri in Bengaluru; Editing by Bernard Orr

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