7 On Your Side Investigates: George Floyd protests likely to be costliest civil disorder in US history
NEW YORK CITY (WABC) -- The insurance industry is predicting that protests over George Floyd's death will become the costliest civil disorder in U.S. history.
The damage from rioting in Minnesota alone led Property Claims Services (PCS) to declare a catastrophe last week, according to a company spokesperson.
PCS is a Versick Analytics business that calculates insured property losses and sets the bar for a catastrophe at $25 million in insured losses.
Meanwhile, the rioting has spread from coast to coast and is now impacting a majority of states.
Claims are still coming in, and insurance companies are still calculating the losses.
"It's still nothing compared to what some hurricanes can be," Insurance Information Institute Vice President of Media Relations Loretta Worters said. "If you look at Hurricane Katrina, that was over $20 billion in losses. This is not going to be that kind of scope. However, it is going to be significant. These are going to be, most likely, the costliest riots in US history."
Prior to the George Floyd protests, the Los Angeles riots in 1992 had been the costliest US civil disorder.
The riots were spurred by the acquittal of four Los Angeles police officers who had brutally beaten Rodney King, a black man.
Adjusting for inflation, those riots led to roughly $1.4 billion in insured losses in today's dollars, according to the Insurance Information Institute.
The riots in Newark in 1967 that followed the beating of a black cab driver by white officers was the 7th costliest US civil disorder, according to the Insurance Information Institute.
Adjusted to today's dollars, insured losses in Newark totaled about $155 million.
More recently, in 2015, the Baltimore riots, in response to the death of Freddie Gray in police custody, fell just shy of reaching a catastrophe designation.
Worters says businesses can file claims for direct physical damage, stolen property, and loss of income.
Individuals who experience vehicle or home damages can also file a claim.
"The insurance industry is in business to pay claims," Worters said. "That's what we do. If it's part of the contract, you will have coverage for the riots."
Typically, civil disorder is considered relatively low-risk to the insurance industry, according to a spokesperson for PCS.
Since 1965, PCS has designated only 12 riots a catastrophe. However, the George Floyd protests are unique in the scope because in this case, it's not one city.
A majority of states in the country are reporting mounting losses as the protests continue.
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