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June 10, 2020

How to Insure Against Losses Caused by Riots

This year has proven that fires and storms aren’t the only events that can cause business interruption. First, many businesses had to close because of COVID-19. Then, just as some businesses were starting to reopen, widespread protests and riots necessitated additional closures. Business owners impacted by these events are likely looking for relief. Here’s what they need to know about coverage for business interruption due to riots.

Coverage for Losses Caused by Riots

Recent protests have been massive, but as a glance at the Wikipedia list of riots shows, riots are a fairly common occurrence both within the United States and around the world. Given this, many businesses may want to insure against the risk.

The good news is that many commercial insurance policies routinely provide coverage for riots.

According to the Insurance Information Institute, Business Owners Policies typically include coverage for business property that has been damaged or stolen due to riots, civil commotion, vandalism or fire. Loss of income may also be covered if the business has business interruption coverage and if there is direct physical damage to the property. With a civil authority provision, loss of income may also be covered if a civil authority order bars access to a business.

According to a FAQ from the Insurance Information Institute, the civil authority provision could apply to curfews. However, there may need to be property damage in the area, as defined by the policy, before coverage can be triggered. 

During the recent protests, some businesses closed early due to city-wide curfews or as a precautionary measure. This means that loss of income may have occurred even without property damage. Whether such loss of income is covered, however, will depend on the details of situation as well as the language of the policy.

As always, it’s important to review policy language carefully.

  • Make sure your business insurance includes business interruption coverage.
  • Check for a civil authority provision that provides protection if your business is ordered to close or if an order prevents access to your business.
  • Review your policy for restrictions and exclusions to see whether you have any coverage gaps.

If you have any questions about your commercial insurance coverage, please contact your Heffernan Insurance Brokers agent.


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