The National Rifle Association is banned from marketing insurance in New York for five years and will pay $2.5 million to settle an investigation into “dangerous” policies promoted to gun owners as a way to cover costs in self-defense shootings, state financial regulators said Wednesday.

The New York State Department of Financial Services announced the consent order with the powerful gun advocacy group after a three-year investigation. State regulators said the NRA violated insurance laws and regulations by acting as an insurance producer without a license by taking part in efforts to solicit and market insurance products, including the NRA’s Carry Guard program.

Carry Guard insurance was launched in 2017 and was promoted to gun-owners as needed coverage to help cover civil and criminal legal costs in the case they shot someone in self-defense. Gun-control advocates called it “murder insurance” in the belief it would encourage gun owners to shoot rather than avoid confrontations.

“The NRA violated the New York insurance law by soliciting dangerous and impermissible insurance products, including those within its Carry Guard program that purported to insure intentional acts and criminal defense costs,” department superintendent Linda Lacewell said in a prepared statement.

The NRA is banned from marketing insurance in New York or receiving compensation in connection with any newly issued New York insurance policies for five years, even if the NRA obtains a license, under the order.

“The DFS inquiry, which began with a roar, ends with a whimper,” William A. Brewer III, counsel to the NRA, said in an email. “The consent order contains no admissions by the NRA, and no NRA member money will fund this settlement.”

From 2000 to 2018, the NRA worked with the Lockton Affinity Series of Lockton Affinity, LLC to offer insurance products to NRA members, their families and affiliated businesses in New York. The NRA received “substantial” compensation, including royalties based on insurance premiums. That means the NRA acted as an insurance producer under New York law, requiring the organization to be licensed, according to the DFS.

More than 28,000 NRA-endorsed policies were placed in New York through Lockton over those 18 years. Between April and mid-November 2017, Carry Guard was marketed and sold throughout the United States, with about 680 policies issued to New York residents. Lockton was fined $7 million in 2018, according to the DFS.

Separately, New York’s Attorney General Letitia James in August sued the NRA, seeking to put the organization out of business over claims that top executives illegally diverted tens of millions of dollars for lavish personal trips, no-show contracts for associates and other questionable expenditures.

The NRA filed its own lawsuit against James, claiming her actions against the group were motivated by her hostility toward its political advocacy. Brewer said the NRA's claims against James, fellow Democrat Gov. Andrew Cuomo and DFS will go forward.

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