With about 42 percent of adults in the United State reporting they have at least one gun in the home, according to 2017 Pew Research, it’s critically important that individuals practice gun safety, take safety courses and lock up their guns properly inside the home. But it’s also important to consider the insurance implications of having one — or multiple — guns inside your home.
Does owning a gun affect your homeowners insurance rates?
Whether or not you own a gun shouldn't have an impact on your homeowner's insurance rates at least not directly. Most insurance companies don't ask if you own a gun, unlike items such as a swimming pool or trampoline that often result in higher rates due to the added liability risk.
How gun ownership could raise your rates, though, is if you decide to increase your coverage because you own a gun. For example, you could decide to increase your liability limits, purchase an insurance rider, or buy an umbrella policy.
However, as firearm awareness blankets our news cycles and social media, gun owners should keep an eye on how their insurance company reacts to the headlines. Some insurers have recently clarified policy coverage, such as Lemonade Insurance, which recently made the decision to not insure assault rifles at all. Since some providers are starting to limit what firearms they will cover, it may become something that eventually turns into an industry standard.
Does liability insurance cover gun-related incidents?
Your homeowners insurance policy usually includes personal liability insurance, which protects you against injuries or damages that you or members of your household cause to non-household members. As you can imagine, the nature of having a gun in the home could bring liability insurance into play. You want to make sure that you carry insurance that is suitable for these instances.
For instance, a hunting accident caused by you, which results in a trip to the emergency room for a non-household member, may be covered by your liability insurance. Or if you accidentally damaged someone else's property with your gun, your insurance may cover the property damage.
In some situations when a person is injured or suffers a worse fate, it's not as clear cut as to whether your insurance covers it or not. Firearms were responsible for more than 30,000 deaths in the United States in 2014, according to the Centers for Disease Control and Prevention, meaning that situations may also arise where the liability insurance would need to cover high-cost expenses.
It's important to realize, however, that there are often exclusions and limitations around what gun-related incidents your insurance will cover. For instance, injuries you or your family members suffer within your home resulting from a firearm are usually not included in most home insurance coverages. Instead, your health insurance could be responsible for injury-related costs.
But if you or one of your household members causes an accidental discharge of the gun inside your home and it injures or kills a non-household member, your liability insurance may cover the associated costs. The keys here are that the shooting is accidental and the injured person isn't a household member. Even if a minor shoots a gun inside your home and the bullet directly strikes someone or ricochets off a household appliance into someone, your insurance won't cover it if the minor intentionally pulled the trigger.
Arguably the most complicated scenario, though, is in self-defense cases where someone fires a gun at a trespasser or intruder. Liability insurance is designed to cover accidents, not intentional actions. And as a result, acts of self-defense often are not covered. Medical and legal costs can escalate quickly if someone is injured or fatally wounded in a firearm-related incident.
Should you purchase an insurance rider?
A standard homeowners policy typically has a $2,500 limit on high-value personal property. So in the event your gun collection is either damaged (for example in a house fire) or stolen, your insurance would only pay out $2,500. If, for instance, you have a collection that is worth $5,000, you'd be responsible for the additional $2,500 out of pocket. Purchasing a valuable property rider can increase your policy limits to avoid this discrepancy in coverage and value.
While a gun collection isn’t the primary reason most own a firearm, Pew Research found that 29 percent of gun owners have at least five guns. For this group of people, it's especially important to consider purchasing a rider to protect their gun collection.
In addition to not insuring assault rifles, Lemonade also won't offer protection beyond the $2,500 limit for firearms. So gun collectors will need to look to a different company if they want to insure their collection. There are other providers out there without such dollar limits that will consider your collection to be covered property, so if this does apply to you, make sure to be thorough in your search. It doesn't take consulting experts to know the risks from owning multiple firearms, so be sure to search for any additional coverage available. It may help further protect you in the case of an incident.
Should you add an umbrella policy?
The minimum liability limit on most homeowners insurance policies is $100,000, though many agents typically encourage policyholders to increase their limits to at least $300,000. Still, you may decide you want higher limits, in which case you should consider adding an umbrella policy.
An umbrella policy comes into play when you exceed your policy limits and are left paying for the rest of the costs out-of-pocket. If you have an umbrella policy, it will kick in to pay the additional costs that you'd otherwise be responsible for out-of-pocket. For gun owners, this would be mostly an added benefit for any necessary civil protection.
An umbrella policy might also help you save money on your insurance coverage. Talk to your local insurance agent about combing policies like gun liability insurance and your homeowners insurance policy. You can also include your auto insurance and life insurance in your umbrella policy (depending on your insurance company.)
Did some insurance companies end relationships with the NRA?
MetLife recently decided to end its discount program for NRA members for car, home, motorcycle and boat insurance. Additionally, Chubb, which was the underwriter for the NRA's carry guard insurance program that provided insurance for gun owners in need of self-defense insurance, publicly announced it was no longer participating in the NRA's program.
While these decisions by MetLife and Chubb haven't impacted how owning a gun impacts your homeowners insurance, it's conceivable that companies could start implementing changes where they won't insure certain firearms, just as Lemonade already has. You may want to reassess your current policy or see if there are any extra steps you can expand your current protection. For gun owners/home owners, it's something worth thinking about in the context of your greater risk protection strategy.
It is not only important to know the laws for owning a firearm in your state, but it is important to know how it affects your insurance policy as well. Make sure you have all the required protection, and possibly more, to keep you and your family safe. Make sure you are protected against an accidental shooting, property damage, and have liability coverages.
As a gun owner, you must have the correct coverage for firearms, and (at minimum) mandatory liability insurance. Take these necessary steps to ensure that you and your family are covered in the event of an accident.
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