Active Shooter Insurance

The United States of America currently averages about one active shooter event for every week of the year. Incidents involving an active shooter are defined as one or more individuals actively engaged in killing or attempting to kill people in a populated area. According to Congress’s Joint Economic Committee, gun violence in America costs over $229 billion annually in incurred expenses relating to health care, emergency response services, legal costs, lost wages, and loss of workplace productivity. Historically, gun violence has been seen as a low probability/high impact event. But in the wake of increased mass shootings, companies look to active shooter insurance in order to secure the financial agency to cope with the aftermath of a mass shooting. In the eyes of some industry experts, active shooter incidents are following the same path that cyber risks once did, paving the way for a new and emerging market for the insurance industry.

Background

In 2015, the Congressional Research Service defined a mass shooting as "a multiple homicide incident in which four or more victims are murdered with firearms, within one event, and in one or more locations in close proximity." A broader definition, as used by the Gun Violence Archive, categorizes a mass shooting as that of "4 or more shot, either injured or killed, not including the shooter." This definition, of four people shot regardless of whether or not that results in injury or death, is often used by the press and non-profit organizations.
In the past few years, there has been a surge in active shooter/mass shooting events in which a shooter used a weapon to claim the lives of more than four people. These shootings have occurred in a variety of places, including Uvalde, TX, Lewiston, ME, Columbine High School, Sandy Hook Elementary school, Virginia Polytechnic Institute and State University (Virginia Tech), Las Vegas, and more recently, Albuquerque, NM. 
Studies by the FBI found an annual average of 44.6 active shooter incidents from 2020 to 2024. Compare this increased average to an annual average of 14.6 active shooter incidents between 2000 and 2018. Between 2020 and 2024, the number of incidents per year has been on a downward trend, peaking at 61 incidents during 2021. These studies determined that between 2020 to 2024, 39% occurred in commerce and 41% occurred in open space locations. 
The increased frequency of mass shootings and active shooter incidents produced an unprecedented ‘gray area’ for the insurance industry. Many general liability insurance policies do not sufficiently cover the total amount of losses that are likely to incur in the wake of a mass shooting. As a result, many insurers have recently explored the option of providing active shooter insurance to organizations that are at risk. For example, in 2015, the Willis Group began selling policies that cover gun violence, otherwise known as active shooter insurance.
Active shooter insurance was originally useful to universities, but the increased prevalence of active shooter incidents has increased the policy to cover hotels, hospitals, businesses and other highly populated institutions. Southern Underwriters Insurance Inc., a company that provides active shooter insurance, determines that any building open to the public is at risk of a mass shooting, and subsequently suggests that these entities purchase active shooter insurance policies. 

Injuries and Damages

Active shooter insurance is emerging as a solution to an industry gray area. New active shooter policies aim to provide coverage for both pre- and post-active shooter incident services. In addition to the physical and emotional harm and potential loss of life resulting from such an incident, insured entities must also prepare for the likelihood of lawsuits from allegations of negligence that allowed the incident to occur in the first place.

In addition to the emotional and psychological impacts of active shooter incidents, any resulting injuries or deaths can lead to workers’ compensation, general liability, and other casualty insurance claims along with subsequent litigation. An active shooter event can also likely lead to physical property damage, business interruption expenses, and reputational harm.

There is a misconception among insureds that their current insurance policy sufficiently covers an active shooter event. Insureds may believe that active shooter incidents are automatically covered by terrorism insurance, which can lead to a debate between insureds and their carriers somewhere down the line. While a property policy is designed to handle physical damage, the general liability aspect of a policy doesn’t clearly cover or exclude active shooter incidents.

With this new market of insurance emerging, it is becoming clear that many at-risk organizations employ active threat responses that may increase the likelihood of fatalities.

Lockdown

The origin of the lockdown plan originated in schools and workplaces in the 1970s as a response to the increased occurrence in drive-by shootings- threats usually only lasting a few seconds from the street. However, law enforcement officials have said that lockdowns may not be the best practice when it comes to active shooter situations, making room for policy underwriters to mitigate risk from assailants. Lockdown drills are practiced by most educational and workplace facilities, even including the U.S. Capitol Congressional offices. But lockdowns might actually make it easier for an assailant to achieve mass casualties.

Those following a lockdown plan have been told to find cover and stay quiet. But many experts in active threat and terrorism have agreed that overseas and domestic assailants have planned to utilize lockdowns as a method to corral and kill large numbers of civilians, making those participating in lockdown “sitting ducks”. While a lockdown might make sense during a drive-by shooting, it fails on many fronts during an active shooter event in a school or office building. Some reasons for this failure include:

• A lockdown only applies to a room not in direct contact with the threat
• Lockdowns do not address or encourage the possibility for evacuation
• Some building infrastructure may not support lockdown tactics
• Lockdowns do not acknowledge the potential involvement of incendiary devices or firearms
• Lockdowns do not account for people that are in contact or will come in contact with the threat

This issue is particularly interesting when we reflect upon the frequency of mass shootings in K-12 schools and universities. Many schools practice lockdown or shelter-in-place drills as the single, optional response to an active threat situation. But this practice has no portability or adaptability and is likely to increase the casualty count when such a situation occurs.

The insurance industry takes on the role of mitigating injury and loss for active threat events, though many underwriters have not been properly trained to identify the shortcomings in lockdown-centered plans and training. Underwriters must be trained to identify facilities that are ill-equipped to respond to an active threat, in part by employing lockdown response training methods despite the circumstances, and reflect such shortcomings in higher premiums for these clients. So, the insurance industry plays a vital role in encouraging sound and proper planning, training, recovery, and design of new facilities as well as promoting robust, best practices for those already in place.

Legislation and Regulation

There is currently no legislation or regulation that exists specifically to address the writing or implementation of active shooter insurance policies. This is likely because active shooter insurance policies vary by insurance provider and are subject to state-specific laws.

Liability and Insurance

Important insurance considerations for the insured include:

Workers’ Compensation and Employer’s Liability

Workers’ compensation and employer’s liability insurance covers the medical costs of employees who are injured in the workplace, including anyone who would be shot on the job, even if the company wasn’t found liable. Following a shooting or any other act of violence, even employees who were not physically injured but witnessed the event may be eligible for workers’ compensation benefits for PTSD or other psychological effects.

In most states, workers’ compensation statutes include “exclusive remedy” provisions that prevent employees injured on the job from making tort liability claims against their employers, making workers’ compensation benefits the sole remedy available to them. However, exceptions to this rule might apply in the case of an active shooter event in some jurisdictions.

General Liability

In most cases, a commercial general liability policy may respond to provide coverage for medical care, bodily injury, property damage, and defense against lawsuits alleging negligence. That being said, it is important for organizations to understand the terms and conditions of coverage for an active shooter event. While GL policies tend to cover the insured party if they are liable for the event, they may not cover customers or any other person at the scene, while some specialized policies may contain an assault or battery exclusion. Furthermore, general liability insurance might also refuse to cover business income losses if law enforcement officials force the business to shut down for a period of time following the shooting.

Umbrella and Excess Casualty

Depending on the size of a loss, umbrella and excess coverage may respond and provide support to affected organizations and victims’ families. Some excess insurance policies contain crisis response endorsements that provide funding for reasonable expenses incurred as the result of a crisis event. Expenses can range from crisis management and public relations assistance, funerals, grief counseling, and travel.

Terrorism

Organizations must consider whether an active shooter event could be deemed an act of terrorism that may be excluded under an insured’s policy if it purchases coverage under the Terrorism Insurance Program Reauthorization Act of 2015 (TRIPRA). Under TRIPRA, an event must meet certain criteria to be certified by Treasury as an act of terrorism. The event must include property and casualty losses of more than $5 million and be part of, “an effort to coerce the civilian population of the United States or to influence the policy” of the government. Thus, active shooter incidents may fall short of this criterion and not be covered under terrorism insurance.

Property and Business Interruption

Following a shooting, organizations should record any physical property damage that would likely trigger property damage and business interruption coverage. Business interruption coverage may apply if an organization is forced to close for repairs or investigations following a shooting. Certain extensions of coverage may or may not be covered, depending on the specific language of the business interruption policy.

Active Shooter Insurance

Most emerging writers of active shooter insurance offer coverage for the direct damages caused by the incident in addition to subsequent damages incurred through litigation. An active shooter insurance policy would go beyond traditional general liability to automatically cover claims for structural damages, before going on to provide more coverage for funeral expenses, medical bills, litigation, business interruption and more. For example, Southern Underwriters Insurance Inc. offers up to $20 million in coverage for damage caused by the active shooter, in addition to any lawsuits that may arise as a result. Some coverage policies also provide crisis management services, funeral expenses and counseling expenses that might result from an active shooter incident. Active shooter policies generally cover the liability that companies have if they are found not to have taken the needed precautions to prevent gun violence, otherwise known as claims of negligence.

According to data from the FBI, 60 percent of active shooter incidents actually ended before police arrived. Some industry data projected that the average active shooter incident was over in twelve and a half minutes, with the average response time of police being four minutes. In response, some insurers are providing active preparedness seminars and training modules. 

In February 2018, GDP Advisors launched its Active Shooter Insurance Program, available through Lloyd’s of London. The program is meant to offer a potential coverage gap in general liability and terrorism insurance policies that some institutions have in place. In addition, the program includes proactive risk management strategies to address potential losses resulting from an active shooter. The coverage evolved into active assailant insurance, which includes attacks by other weapons, such as motor vehicles. 

The program offers a primary policy with clear third-party coverage and no exclusions related to the type of incidents. Limits range from $1 million to $20 million and premiums gauged for academic campuses are based on several factors, such as number of students, location, square feet, and number of campuses. The coverage also includes onsite active shooter and security vulnerability assessments, preparedness seminars and training modules, and post-event crisis management services. Recently, the active shooter insurance market is growing with insurers now offering anywhere from $25 million to $200 million in coverage. 

Under active shooter insurance, an active shooter situation is not limited to firearms, but also includes knives, weapons, and certain types of explosives. XL Caitlin’s “Active Assailant” coverage was added to its crisis management product suite to help organizations deal with the financial impacts of an active assailant. Unlike general liability policies, the coverage will help organizations deal with a range of issues including business interruption, denial of access, medical expenses, and rehabilitation costs.

Litigation

Insurance policies generally apply to events that are unexpected. Due to the nature of active shooter incidents involving an intent to harm, they are generally excluded from coverage. Most business owners however only bear liability when the harm was foreseeable and they did not take the necessary steps to prevent the incident. Recent federal court decisions display how general liability policy exclusions prevent liability for active shooter incidents. 

United Specialty Insurance Company v. Cole’s Place (2019)

In 2015, an active shooter incident at a Louisville nightclub (Cole’s Place) injured eight people. Six of these people sued Cole’s Place due to a failure to “protect the plaintiffs from a foreseeable harm.” The United Specialty Insurance Company stated that it was not obligated to defend Cole’s Place in state-court litigation under a federal declaratory judgement, which Cole’s Place appealed.

The Sixth Circuit court affirmed United Specialty Insurance Company’s discretion in using federal declaratory judgement. Further, the Sixth Circuit affirmed that the assault-and-battery exclusion in Cole’s Place’s insurance policy, which did not apply to “bodily injury” or “property damage” arising out of assault or battery, applies to state lawsuits.

Hudson Specialty Insurance Company v. Snappy Slappy LLC (2019)

In 2017, a deadly shooting at Snappy Slappy LLC resulted in a wrongful death action against the bar. Snappy Slappy turned to Hudson Specialty insurance Company, who previously issued general liability insurance to the bar. Following the complaint, Hudson Specialty Insurance Company filed a declaratory judgement action because of a ‘firearms exclusion’ in the general liability policy. The general liability policy provided insurance for “bodily injury” excluding injury arising from the “use of firearms.”

The Federal District Court in Georgia primarily denied Hudson Specialty Insurance’s claim for declaratory judgement because the general liability policy was ambiguously defined in who must be using the firearm for the exclusion to apply. Later, the Federal District Court in Georgia reversed its decision, and approved declaratory judgement because the firearm exclusion should apply to any person’s use of a firearm.

2025 Developments

Similar to the above reasoning, the court in James River Ins. Co. v. SureFire, LLC (2025) and in Kinsale Insurance Co. v. Blackbriar Protective Services LLC (2025) ruled that because the shooting incidents were not accidental “occurrences”, their insurance policies did not cover them.

Future Outlook

Each year, active shooter incidents and mass shootings become more frequent. As the commonality of active shooter incidents looms over insureds, the market growth of active shooter insurance will likely continue, with increases in insurance policies as well. Chris Parker, Head of Political Violence and Deadly Weapons Protection at Lloyd's of London insurer Beazley stated that insurance policies have seen a 30-35% jump in inquiries in the year 2022 while an article in PropertyCasualty360 stated that orders and submissions in 2023 for active shooter insurance were up 50%. Additionally, insurance policies have progressed to offering a wider range of preventative measures, including teaching individuals how to identify a potential crisis. Unfortunately, this dangerous reality will continue to be on the forefront of the insurance industry for years to come.

Additional Items

• Families of Odessa Mass Shooting Victims File Suit, Seek $1M
  Family members of two of the deceased Odessa mass shooting victims are suing the person who supplied the AR-style firearm to the mass shooter as well as the gun parts manufacturer for over $1 million in damages.
• Indiana teachers hit by pellets in shooter training drill sue police
  A group of teachers at a northern Indiana elementary school who were struck and injured last year by plastic pellets during an active shooter training drill are suing local police, accusing them of using excessive force during what the lawsuit calls the “Execution Style Drill.”