Insuring the Unthinkable

Abstract

Recent mass shootings have led to public and private responses implicating insurance. The public response consisted of calls to require firearm owners to purchase liability insurance, and has been discussed at length elsewhere. This article examines the private response: the steady proliferation of “active shooter insurance,” more recently called “active assailant insurance.” (collectively, AS/AA insurance). Although these policies cover the for-profit businesses, nonprofit institutions, and even municipalities that purchase them, rather than shooting victims or others impacted by a tragic event, benefits would flow through to these individuals if a covered event occurs.

This article assays AS/AA insurance along several dimensions. Part II considers factors impacting the effectiveness of the insurance in compensating insureds for losses stemming from AS/AA incidents. Part III reviews the ways in which AS/AA insurers can provide loss prevention services, enable insureds to prevent or mitigate losses, and efficiently manage claims and resulting litigation. Part IV concludes.

Keywords: insurance, active shooter, active assailant, firearm, mass shooting, mass shooter, firearm, firearms, gun, guns, risk, insurers, adverse selection, incentives, loss prevention, service efficiencies, underwriting