London riots could cost “well over” Cdn$160 million

Citing the Association of British Insurers, catastrophe modeler RMS estimates insured losses related to four days of riots that originated in London, United Kingdom will top out at “well over £100 million” (approximately Cdn$160.1 million).
RMS quoted participants saying the violence followed a police incident on Aug. 4, when a young man was shot dead while a passenger in a taxi. The riots started in London’s northern district of Tottenham on Aug. 6 and have spread to other cities, including Birmingham, Bristol, Leicester, Manchester, Nottingham and Wolverhampton.
Police have arrested more than 750 people so far, RMS reports. “The rioters have mainly looted banks, department stores, electronic stores, mobile telephone operator, supermarkets, shoe apparel and shops selling alcohol.”
The cat modeler added the riots “appear to have little unifying cause other than to desire to cause damage or to steal.”
In an update on the situation, Crawford & Company said the absence of any apparent political motive might simplify claims handling in the sense that “gaps in coverage are unlikely to exist where terrorism is excluded.”
Crawford added it was moving some of its services to temporary locations for safety reasons on the advice of police. “In view of the ongoing threat of further disturbance in Birmingham, we will temporarily transfer our out-of-hours service, which is based in the jewellery quarter of Birmingham, to our ClaimsAlert service in Canada,” the adjusting firm announced.
Whether or not police will officially designate the violence a “riot” is the subject of some debate.
RMS notes “damage to both individuals and local property is most likely to reimbursed by the local police authorities under the provisions of the Riots Act 1886, which specifies that where property damage is caused by people, local police authorities are required to compensate the victims.”
But Crawford’s briefing note on the situation expressed skepticism. “We believe that it is unlikely that the police will expressly declare a “riot,” irrespective of media coverage and references to the same,” the firm said. “It is important that policyholders comply with the terms set out in their insurance policy, particularly notification requirements, so as not to prejudice insurers’ position in the event that a recovery for riot exists.”