What universe does this guy live in where gang bangers and crack heads line up to insure their guns? Oh, they're not going to insure their weapons? Well, what's the point then?

Why not? They insure their cars, don't they? Nobody said "We shouldn't have auto insurance, because the gangbangers and crackheads won't obey the law". In fact, if we created laws based off of what was acceptable to gangsters, we'd have a very scary society indeed.