The vandalism following the death of George Floyd while in custody of the Minneapolis police will cost the insurance industry a record for violent demonstrations of at least $1 billion to $2 billion in paid insurance claims, Axios reported on Wednesday.
The violence that took place in 140 American cities from May 26 to June 8 this year will eclipse the record $775 million in paid insurance claims set in Los Angeles in 1992 after the acquittal of the police officers who brutalized Rodney King, according to Property Claim Services, a company which has tracked insurance claims connected to civil disorder since 1950.
This is also the first time that PCS has designated a civil disorder as a multi-state catastrophe event, according to an article on the Insurance Information Institute’s website.
Other incidents on the top 10 list of paid insurance claims for violent protests were the 1965 Watts riots in Los Angeles, the 1967 Detroit riots, and the New York City blackout of 1977.
However, the record losses for violent demonstrations this year are small in comparison to those for natural disasters, such as hurricanes and wildfires. For example, Hurricane Isaias is estimated to cost between $3 billion and $5 billion in insurance losses, and wildfire losses were $18 billion in 2018, the last year available, according to Risk Management Solutions.
The insurance industry is also anticipating potential unrest following the November election, with Tom Johansmeyer, head of PCS, telling Axios that “There could be riots that lead to significant losses that would meet our reporting thresholds.”