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After watching the events in Baltimore last week, or those in Ferguson last year, business owners can't help but wonder if the same couldn't happen to their downtown storefronts. And if so, will insurance cover the damage from riots and the loss of revenue from curfews?
Let's take a look at some common business insurance policies and see if you and your small business are covered.
Most basic forms of small business property insurance will reimburse you for damage from riots and vandalism, including explosions and fire damage. You can also upgrade plans for broader coverage for broken windows and falling objects. However, theft is often not covered under basic property insurance plans, and may only be available in more expensive packages.
You should read your insurance policy carefully, so that you know what is covered in case you need to make a claim. That will help you assess your business' risks and whether the coverage you have is enough.
As one Baltimore bar owner noted in a letter to the mayor: "We have insurance for vandalism, not loss of revenue." Liam Flynn was pleading with Mayer Stephanie Rawlings-Blake to lift Baltimore's 10 p.m. curfew, noting it would "do more damage financially to our bars & restaurants than rioters will do."
Flynn is correct in his statement: most insurance policies don't cover a loss in revenue, even from government-imposed curfews and other public safety regulations. Even if business owners wanted to purchase such coverage, insurance companies would be disinclined to offer it, given the difficulty in distinguishing lost revenue due to the curfew and a predicted dip in sales due to customers' safety concerns.
If you're unsure whether your current insurance policy covers riot damage and/or loss of revenue due to police curfews, or you want legal assistance in choosing a plan that does, you can contact an experienced small business attorney near you.
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