Parts of Baltimore hit by riots

Parts of Baltimore hit by riots

Maryland has issued a state of emergency following the worst riots in Baltimore since the assassination of Martin Luther King in 1968.

Following a period when Mayor of Baltimore Stephanie Rawlings-Blake and state Governor Larry Hogan appear to have mandated a soft-touch response to protests at the death of Freddie Gray, who suffered an as-yet unexplained spinal injury while in police custody.

Any hope that the protests would eventually burn themselves out vanished by Monday when looting began during the day. Several buildings were on fire by Monday evening local time.

A week-long 10pm to 5am curfew has been imposed from today, following reports that several buildings and cars were on fire.

The riots began in the Mondawmin district, west Baltimore. Governor Hogan has called for 5,000 national guard troops and 5,000 police from other states to deal with the riots.

Defending their initial response, Rawlings-Blake said that it would not have been appropriate to call in the national guard over the weekend, and that the vast majority of the protestors had been non-violent. "We have seen all over the country and throughout our history what happens when you use too much force to respond to an incident. It escalates and it can be a lot worse".

At least 15 police officers had been reported injured. The Baltimore Orioles baseball game against the Boston Red Sox was postponed. The Mondawmin shopping mall appears to have come under attack overnight, with Baltimore Police reporting several people inside the mall "looting and destroying property".


Riot insurance in the US

It appears to be a misconception that homeowners and business owners are not covered against civil disorder. Two routine policies, the Business owners policy (BOP) and the homeowners' policy (HOP), would offer cover against damage caused by the Baltimore riots, provided the loss (be that bodily injury or property damage) is neither expected nor intended from the standpoint of the insured.

Typically a BOP would include full replacement compensation for "Riot and Civil Commotion" and for "Vandalism". BOPs can also offer "business income" coverage, provided there is a direct physical loss of or damage to the property. In other words, insureds could not make a claim on the grounds that fewer tourists were coming to Baltimore as a result of the riots, or that their particular part of town was less popular as a result of the riots.

The business income also only covers a short-term "period of restoration", that being the time taken to repair the damaged property at "reasonable speed" or, if the property is a write-off or could not be repaired at a reasonable speed, then the date that the business moves to a new permanent location.

The BOP also offers cover should Civil Authorities prohibit access to a premises, even if that premises is not damaged. That would include a police curfew, barricades and other restrictions on access.

Since Baltimore has instituted a week-long overnight curfew, this would presumably enable businesses that function during curfew hours to make a claim.

A typical Homeowner policy also covers Riot or Civil Commotion and Vandalism, provided the home has not been vacant for more than 60 consecutive days.

According to the Insurance Information Institute, the biggest insured loss riots in the US were in Los Angeles in 1992, also known as the Rodney King riots.

Those riots generated roughly $1.3bn in insured damages in today's dollars.

Of the 10 most expensive US riots on record, seven were in the 1960s.

The death last year of Michael Brown in suburban St. Louis was estimated to have caused insured losses of less than $10m, indicating that natural catastrophes are still more likely to hit insurers for major losses.

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