Q&A: What you need to know about N.J.’s new handgun liability insurance law

Gov. Phil Murphy signed P.L. 2022, C.131 into law, which requires any person in the state carrying a handgun in public, to maintain liability insurance coverage. What you need to know about this new law:

What does it say?

The new law is a comprehensive gun safety law related to the carrying of handguns in public. The law restricts who is eligible to carry handguns in public, establishes a list of places in which people cannot carry handguns even with a permit, and requires those with a public carry permit to maintain liability insurance.

What prompted this law?

The new law is a comprehensive gun safety law. It was passed in direct response to the recent U.S. Supreme Court decision in New York State Rifle & Pistol Association v. Bruen. In that case, the Supreme Court ruled that a New York law, which required a person to show proper cause or a special need to obtain a concealed carry license was unconstitutional. While this decision only impacted New York, after the ruing many states that employed similar “may issue” laws began making changes to the law anticipating similar legal challenges. A-4769/S-3214 is New Jersey’s attempt to do just that.

What are the insurance requirements?

Any citizen who carries a handgun in public in the state must maintain liability insurance of at least $300,000. This insures against any loss, bodily injury, death, and property damage, as a result of the ownership, maintenance, operation or use of a firearm carried in public.

How is the state enforcing the insurance requirements?

To thoroughly monitor A-4769/S-3214 compliance, handgun permit applicants must provide proof of liability insurance coverage and guarantee that the applicant will maintain the insurance coverage for the duration of the permit.

The chief police officer or superintendent of the State Police will be required to verify the liability insurance prior to issuing a permit to carry a handgun.

Where can you find liability coverage?

A homeowners policy is the most common place to find liability coverage. The standard HO-3 policy developed by the Insurance Service Office should provide coverage for the situations contemplated by the law.

Standard HO policies cover legal liability damages where the policy states the following:

“If a claim is made or a suit is brought against an ‘insured’ for damages because of ‘bodily injury’ or ‘property damage’ caused by an ‘occurrence’ to which this coverage applies, we will:

1. Pay up to our limit of liability for the damages for which an ‘insured’ is legally liable. Damages include prejudgment interest awarded against an ‘insured’; and

2. Provide a defense at our expense by counsel of our choice, even if the suit is groundless, false or fraudulent. We may investigate and settle any claim or suit that we decide is appropriate.” [HO 00 03 03 22 Section II–Liability Coverages (A)(1-2)]

Occurrence is defined in the policy as an accident, including continuous, repeated exposure to substantially harmful conditions, which results, during the policy period, in: “bodily injury”; or “property damage.” Before getting to the exclusions, the policy should provide liability coverage, if the use of a handgun results in bodily injury or property damage. But, are there exclusions?

There are exclusions to when liability coverage applies but fortunately in this case, none apply to firearms. Generally, the exclusions are limited to liability related to motor vehicles, watercraft and drones.

There is an exclusion for expected or intended injury that might give some pause. However, that exclusion contains an exception, which extends coverage to bodily injury and property damage resulting from the use of reasonable force by an insured to protect persons or property [HO 00 03 03 22 Section II–Exclusions E (1)(a-b)]. While this exception to the exclusion would not extend coverage for criminal use of a handgun, it would provide coverage for defense in establishing reasonable force (in which case no damages would be awarded) and instances where the insured was negligent in causing injury without the expectation or intention of injury.

I heard that a court issued a judicial order to prevent the new law from going into effect. Is that true?

Yes. There are been several successful challenges to this new law. Earlier this year, a federal court judge issued a ruling that blocked parts of the new gun reform law from going into effect. As mentioned above, the new law establishes a list of places in which people cannot carry handguns even with a permit.

The places where a person can legally carry a handgun is the specific aspect of the law that the court blocked. For now, handgun owners can carry in nightclubs, theaters, arenas and concert halls, among other locations.

In May 2023, another Federal District judge ruled that the insurance mandate found in the law was unconstitutional. This should delay the implementation of that mandate indefinitely.

Get involved

If you want to get involved with PIANJ’s legislative and advocacy work, there are many ways to engage with the association:

• participate in PIANJ’s District Office Visit Program by emailing resourcecenter@pia.org;
• become a member of New Jersey PIAPAC; and
• watch your PIA Northeast publications and PIA Northeast’s social-media channels for important New Jersey updates, and share them with your followers.