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Firearms have the capacity to maim or to kill. They are not toys and should never be treated casually. Dealers are responsible for meeting all federal regulations, but complying with regulations does not protect them from lawsuits. Retailers may modify, repair, or alter a weapon, thereby exposing them to a product manufacturer’s liability. Distributors may import firearms directly and be held primarily liable if a suit should result from use of the weapon.
The theft potential is also extremely high. If a weapon is stolen and used in a crime, the dealer that sold it may be held liable for injury caused by use of the stolen weapon because the dealer allowed the weapon to be stolen. |
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Here is a possible loss scenario:
Larry and John are competitive target shooters. They purchased new rifles at Adventure Guns & Ammo and had them customized by Karl, Adventure’s gunsmith. Karl also packed their ammunition.
They picked up their rifles and ammunition and went to their club’s shooting range to test everything prior to their next tournament. John was up first. He slowly squeezed the trigger, and the recoil threw him backwards. He ended up on the floor with a broken shoulder. The errant round struck Larry in the thigh.
John sued Adventure Guns & Ammo for his shoulder injury. Larry also sued, alleging that his injury was caused by Adventure’s customizing. |
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In some respects, firearms dealers are similar to other retailers. Customers enter their establishments to inspect, compare, and purchase various types of merchandise. This means that all of the common property and liability exposures are present. As retailers, firearms dealers also look to the manufacturer as having the primary responsibility for a product-related lawsuit.
While there are many similarities in exposures, there is a critical difference: A firearm is one of the few products sold to ordinary citizens that can be used to kill or maim. Although firearms may be used for a variety of nonviolent purposes, all are designed to fire a round when the trigger is pulled.
Robert V. Chiarello, president of Joseph Chiarello & Co., Inc., says, "We arrange coverage for commercial retail firearms stores, which may also include gunsmithing and shooting ranges. Distributors are generally involved with shooting, hunting, and fishing sports and may also import directly from foreign countries.”
The appetite at Philadelphia Insurance is similar. Brent Skiles, assistant vice president-underwriting at Philadelphia Insurance Company, explains, “We are looking for retail gun shop operations with true retail storefronts. These include operations that sell new firearms, used firearms, ammunition, archery equipment, firearms accessories, hunting accessories, fishing equipment, and clothing. In addition, we are looking for operations that also conduct other activities, including shooting ranges (firearms and/or archery), kayak/canoe rental, guiding exposures (hunting and/or fishing), or firearms instruction. We are also looking for operations that conduct gunsmithing operations, including (but not limited to) bluing, re-stocking, bore sighting, scope mounting, trigger jobs, barrel modifications, and so on. We are also interested in wholesalers that sell new firearms and accessories. These can include operations that have distributor or wholesaler special edition firearms, distribute to individual federal firearms license (FFL) holders, transfer, or distribute to retail gun shops.”
Among the markets for this coverage are Admiral, Chartis, Granite State, Lexington, New Hampshire, and Philadelphia Indemnity.
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