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Lockton to pay $7M fine over NRA-branded insurance program

The New York Department of Financial Services imposed a $7 million fine on insurance broker Lockton Cos. LLC and its affiliate, Lockton Affinity LLC, for offering administrative services to a National Rifle Association-branded Carry Guard insurance program.

The NRA allegedly actively marketed and solicited for the Carry Guard program despite not having a license to conduct insurance business in New York. A department investigation found that the Carry Guard program unlawfully offered liability insurance to gun owners for certain acts of intentional wrongdoing and improperly gave insurance coverage for criminal defense.

The department also found that Lockton violated New York's insurance law that requires excess line insurance brokers to obtain separate declinations from authorized insurers for each insured before it can place the Carry Guard program and other NRA-related policies. Lockton allegedly secured declinations from three authorized insurers once annually for a single policy for each of the programs, and then relied on that for all other insureds under the programs.

Aside from paying the fine, Lockton agreed to refrain from participating in the Carry Guard program, or any similar program in New York and from providing Carry Guard or similar insurance policies for or to New York residents.

In February, Lockton Affinity said it will no longer endorse the Carry Guard program.