Existing law requires the Department of Insurance, headed by the Insurance Commissioner, to regulate specific classes of insurance, including liability, burglary, and legal insurance. Existing law prohibits an insurer from transacting any class of insurance that is not authorized by its charter. Under existing law, a surplus line broker is guilty of a crime if the broker issues evidence of insurance in violation of state law, as specified.

This bill would, on and after January 1, 2020, prohibit an insurance policy from covering a loss related to the use of a firearm, except for loss of, or damage to, property related to the use of a firearm. The bill would exclude an automobile insurance policy, a homeowners’ insurance policy policy, or a commercial insurance policy from that prohibition, if specified criteria are met. The bill would authorize an insurer to issue or renew a commercial policy that insures a licensed firearms dealer against liability for, among other things, injury to or death of a person as a result of the theft, sale, lease, or transfer of a firearm or ammunition. The bill would also prohibit a surplus line broker from issuing evidence of insurance for a loss related to the use of a firearm for a home state insured, or causing or purporting to cause a nonadmitted insurer to insure a loss related to the use of a firearm. Because a violation of this provision by a surplus line broker would be a crime, the bill would impose a state-mandated local program.