Insurance Question: Say Rioters Destroy My Business, Am I Covered?
If you ask your broker, the answer may be no. But don’t just accept that response. Know what your policy covers, and how to protect yourself.


A riot breaks out. Your business or home is vandalized and torched. Will your homeowners/commercial insurance policy offer coverage? That was Alan’s question:
“Mr. Beaver, my family owns and operates a small general store, carrying a wide variety of merchandise. Frankly, we are terrified of the civil unrest that has engulfed parts of America, with small businesses like ours destroyed by rioters.
“I asked our insurance broker if we would have coverage should such a terrible thing happen to us, and he answered, ‘Don’t even dream of making a claim. If it happens, the insurance company will tell you it is a rebellion, civil war, and they do not cover civil war.’
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.

Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
“I have read your column for years and walked away with a strong feeling that I can’t trust our broker to tell us the truth. Would we be covered if rioters destroyed our business? Thanks. Alan.”
Brokers and Agents are the Company’s First Line of Defense – Do Not Rely on Them
I ran Alan’s timely question by Los Angeles based attorneys Brian S. Kabateck and Shant Karnikian who specialize in insurance bad faith cases. Both have been longtime friends of this column, always ready to answer readers’ questions.
Kabateck: In general, unless specifically excluded, a business owner’s insurance policy will cover all physical damage to property and the contents inside even when the cause is riots, civil commotion or vandalism. Also, most business policies cover loss of income resulting from physical damage to the premises.
However, we repeatedly find that policyholders have been led to believe there is no coverage for these types of losses, when in fact there generally is. This impression is created, we have learned time and time again, by some insurance companies through an active campaign of misinformation waged by their brokers and agents.
Consumers will usually turn to their broker or agent for assistance in making a claim and believe they have the policyholder’s best interests in mind. While many do, this cannot be assumed.
Karnikian: Most people are unaware that brokers’ and agents’ commissions are often tied to the amount of claims paid to policyholders. This means there is a financial interest in minimizing the number and size of claims made by their policyholders.
As a result, they will often discourage their very own policyholders from making claims by mistakenly (or even deliberately) misrepresenting that the loss is not covered.
Brokers and agents are the insurance companies’ first line of defense against your ability to recover benefits you are owed under the policy. Anyone caught up in such a horrible situation needs to speak with their attorney instead of just accepting their agent’s advice to forget making a claim.
How to Prepare for an Insurance Claim if Rioters Damage Your Property
We have all heard the saying that an ounce of prevention is worth a pound of cure, and the same applies to a possible insurance claim resulting from civil disobedience. Both attorneys strongly urge reading your insurance policy to understand what has been excluded.
Kabateck: Most policies do exclude such things as civil war, revolt, revolution, rebellion and insurrection, but our country has seen nothing approaching that.
Karnikian: You need to prepare for the possibility of a claim due to a protest getting out of hand. This starts with knowing what your policy covers and, as with any type of property loss, being able to submit a detailed audit of what you have lost.
Kabateck: Know what your policy provides before tragedy strikes. If you are in an area where it is feared a riot or looting could occur, be pro-active and meet with a business lawyer who has experience with insurance policy language and claims procedure. This is especially important in the complicated area of business interruption losses.
Take photographs and video your premises. Essentially, you want to have proof of what was lost ready before the event, and keep this information stored off premises or in the cloud.
If you become a victim, track all damage, expenses and lost income, because your insurance company will need detailed proof of loss early in a business interruption or property damage claim. It is also a good idea to set up a separate accounting code to facilitate documenting insured losses.
Karnikian: Hope to never need their services, but line up companies that can board up the property and perform remedial cleaning and repairs.
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

After attending Loyola University School of Law, H. Dennis Beaver joined California's Kern County District Attorney's Office, where he established a Consumer Fraud section. He is in the general practice of law and writes a syndicated newspaper column, "You and the Law." Through his column, he offers readers in need of down-to-earth advice his help free of charge. "I know it sounds corny, but I just love to be able to use my education and experience to help, simply to help. When a reader contacts me, it is a gift."
-
Rally Fades on Mixed AI Revolution News: Stock Market Today
All three main U.S. equity indexes opened higher but closed lower as a seven-session winning streak for the S&P 500 came to an end.
-
Stretch Your Holiday Shopping Budget Further with These Under-$50 Gifts That Don't Feel Cheap
Amazon October Prime Day is the perfect chance to nab some under-$50 gifts that feel more expensive than they are (because normally they would be).
-
The Spendthrift Trap: Here's One Way to Protect Your Legacy From an Irresponsible Heir
A spendthrift clause in an estate plan can protect an inheritance from a financially irresponsible child's debts and poor decisions.
-
Adapting to AI's Evolving Landscape: A Survival Guide for Businesses
Like it or not, AI is here to stay, and opting out could be disastrous for your organization. Instead, focus on what you can control and be flexible, as AI is still evolving.
-
Striking Gold (or Gas): A Financial Pro Unpacks the Nuances of Energy Investing
Investing in the energy industry, particularly oil and gas, involves understanding the facts about how projects generate returns through cash flow and long-term asset building, while also being aware of the risks.
-
Escaping the New Golden Handcuffs: A Financial Expert Has a Plan for Today's Executives
Feeling stuck in your job? It could be your complicated compensation package, but it also could be where you live, your family or even how you view yourself.
-
I'm a Financial Planner: Here's How to Invest Like the Wealthy, Even if You Don't Have Millions
Private market investments, once exclusive to the ultra-wealthy and institutions, have become more accessible to individual investors, thanks to regulatory changes and new investment structures.
-
Four Ways a Massive Emergency Fund Can Hurt You More Than It Helps
Saving too much could mean you're missing opportunities to put your money to work. Redirect some of that money toward paying off debt, building retirement funds, fulfilling a dream or investing in higher-growth options.
-
I'm a Financial Planner: How to Dodge a Retirement Danger You May Not Have Heard About
Timing is everything, and sequence of returns risk can mean the difference between a retirement nest egg that's overflowing … or empty.
-
Caring for Aging Parents: An Expert Guide to Easing the Financial and Emotional Strain
Early conversations, financial planning and understanding the progression of care needs can help to mitigate stress and protect family relationships.