The riots, looting and arson that took place in some 20 states in the days and weeks after George Floyd’s murder by Minneapolis police on May 25 could cost the insurance industry up to $ 2 billion in claims, it has been reported.
The previous record for the most expensive period of civil unrest in insurance history was set in 1992, when Los Angeles was engulfed in violence for a week following the acquittal of four police officers who were filmed beating Rodney King.
The Los Angeles riots resulted in the payout of $ 775 million in insurance claims.
If you consider inflation, that would add up to $ 1.42 billion, it said Axios.
Other costly cases of civil unrest include the 1965 Watts Riots in Los Angeles ($ 44 million); the 1967 Detroit riots ($ 42 million); and the riots and looting that took place during the 1977 New York City power outage ($ 28 million).
People walk past a store that was looted during a riot after a rally expressing outrage over George Floyd’s death on May 30 in Seattle. Insurance companies will pay out up to $ 2 billion in claims for property damage caused during the nationwide riots
Rioters burn and loot an Office Depot in Minneapolis on May 29. The unrest following Floyd’s death was the most expensive in insurance history
There were riots, vandalism, looting and arson in some 140 cities in the days and weeks after Floyd’s death. A police vehicle in Pittsburgh was set on fire on May 25
People run away with merchandise from a store during widespread protests and unrest in response to George Floyd’s death in Santa Monica, California, on May 31.
Floyd died in the custody of the Minneapolis Police Department on May 25
The data was collected by Property Claim Services, a company that has been tracking insurance claims related to civil unrest since 1950.
The company considers any riot that results in more than $ 25 million in insured losses as a “catastrophe.”
PCS estimates were made by assessing the damage caused in the period between May 26 and June 8.
While other riots caused considerable damage, the events following Floyd’s death were unprecedented.
The unrest spread to some 140 cities in at least 21 states and to the District of Columbia.
The previous record of the most destructive riots causing the most property damage was the Los Angeles riots in 1992
COST RISKS IN US HISTORY.
Nationwide George Floyd riot for $ 1-2 billion
Los Angeles, 1992, $ 775 million
Miami, 1980, $ 65 million
Los Angeles, 1965, $ 44 million
Detroit, 1967, $ 42 million
New York City, 1977, $ 28 million
Washington, DC, $ 24 million
Newark, 1967, $ 15 million
Baltimore, 1968, $ 14 million
Chicago, 1968, $ 13 million
In at least 40 cities, authorities imposed curfews and at least six people were killed.
The National Guard was called to assist in about 21 states, as well as Washington, DC.
Experts warn that ongoing racial tensions could lead to even more insurance claims.
The chief of fire in Kenosha, Wisconsin, says the damage from the unrest over the August 23 shooting of Jacob Blake is now more than $ 11 million.
Fire Chief Charles Leipzig told police and firefighters on Tuesday that the record loss came in the days after the shooting of Blake, a 29-year-old black man who remained partially paralyzed after a white officer shot him seven times in the back. .
“To put into context, for us, that’s three years of fire loss in about a week,” Leipzig told commissioners, Kenosha News reported.
The shooting, which was videotaped, sparked protests and violence in Kenosha, where about 20 fires were started and countless businesses destroyed.
Prosecutors say 17-year-old Kyle Rittenhouse of Antioch, Illinois, shot three protesters and killed two of them in a chaotic protest on Aug. 25.
Last month, riots broke out in Kenosha, Wisconsin after a white police officer shot a black man, Jacob Blake, 29. President Trump is seen touring the affected area in Kenosha on September 1.
Property damage as a result of riot or civil unrest is generally covered by standard auto, business and home owner insurance policies, according to the Insurance Information Institute.
But the claims that insurance companies have made over the years as a result of civil unrest pale in comparison to those related to natural disasters.
According to Swiss Re, insurance companies paid out a total of $ 219 billion worldwide for natural disasters in 2017 and 2018.
In California alone, insurance companies paid out $ 20 billion in claims during those two years after wildfires ravaged the state.
This year’s wildfires in California are the most damaging on record, as 2.2 million acres have gone up in flames – even with the season still having weeks to go.
RMS, a risk strategy company, estimates that the insured losses caused by Hurricane Isaias will range from $ 3 billion to $ 5 billion.