Election Day in the U.S. spurs political unrest concerns
The days and weeks after the election could prove most consequential, the Council on Foreign Relations reports.
The outcome of the U.S. presidential election could create political unrest or even violence within local communities, according to the Council on Foreign Relations (CFR).
“The days or weeks following the election could prove the most consequential, particularly if a clear winner has not emerged for the presidency,” the CFR said recently. “Such uncertainty gives conspiracy theories greater space to develop and circulate and can significantly increase political unrest or even violence within local communities.”
With the voting booths still open, PropertyCasualty360.com spoke to Anthony Crawford, a partner of the Insurance Recovery Group at Reed Smith, on what businesses can expect from their insurers should the U.S. election end in political unrest and localized violence.
Crawford serves a wide array of clients ranging from banking and financial institutions to religious organizations, providing policy review, coverage analysis, counselling and dispute resolution services on a variety of insurance policies, with special emphasis on general liability, directors & officers, errors and omissions (professional liability), commercial property, mortgage, and fine arts policies.
PropertyCasualty360.com: Is there a heightened risk of civil unrest or riots following the 2024 presidential election? If so, why?
Crawford: One would hope not. The reality, however, is that we are living in a very politically polarized environment where passions can run high.
So, there is always the possibility. Given the events following the 2020 election, the nation has seen significant efforts being put in place to deal with civil unrest should it occur. Hopefully, those measures will ultimately prove to be unnecessary.
PropertyCasualty360.com: Will common commercial insurance policies cover losses from riots, civil commotion or vandalism, as well as reactions from police and other authorities to such events?
Crawford: The short answer is most likely yes, absent some exclusion in the policy. Generally, commercial insurance policies may provide coverage for losses due to “riots, civil commotion or vandalism”.
Frequently, commercial property policy will have standard policy form language which includes coverage for: “Riot or Civil Commotion, including: Looting occurring at the time and place of a riot or civil commotion.” Policies will also generally cover “vandalism” defined as the “willful and malicious damage to, or destruction of, Covered Property.” The catch to this coverage is that it does require actual property damage to occur.
PropertyCasualty360.com: Will commercial property policies cover damaged property and economic losses should business be interrupted?
Crawford: Generally, they should. Absent any exclusions, insurance policies should pay for the damage to property incurred as a result of riots, civil commotion or vandalism. Likewise, commercial property policies will also cover lost business income following physical loss or damage while the policyholder repairs, replaces or restores that property.
Insurance companies will often require detailed financial information regarding the policyholders’ operations to support business interruption claims. Insurance companies may request historical financial information, including as far back as one to two years prior to the loss.
PropertyCasualty360.com: Are businesses preparing for the potential of in-house issues between employees related to the election results? How will insurance play a role?
Crawford: Again, this may be due to my hopeless optimism, but I would hope that businesses do not need to prepare for fistfights to break out in the workplace over the election results.
That said, workplace disputes are not new and businesses should have procedures in place to deal with workplace disputes. Insurance coverage for such altercations may be tricky. Businesses generally carry employment practices liability policies insurance, but these policies generally exclude coverage for claims for bodily injury, intentional acts (assault, battery, criminal conduct). Workers’ compensation pays for medical expenses and a portion of wages lost when a worker suffers a work-related injury.
In order to receive workers’ compensation benefits for workplace violence, the incident must be directly related to employment. Personal disputes between coworkers or violence stemming from personal matters, such as political disagreements are typically not covered.
PropertyCasualty360.com: Have past events linked to political unrest and violence shaped risk potential in 2024?
Crawford: So, in terms of insurance companies pricing policies, it is not clear that these isolated events necessarily drive pricing given their infrequent nature. This is different from certain known risks from natural disasters such hurricanes or wildfires.
That said, it may be possible, for example, that a university may face higher premiums because of a history of their fans tearing down the goalposts when they win.
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