Riot costs could 'decimate' police authorities' funds

Riot damage in Manchester Premises in cities such as Manchester face a rebuilding operation

Funds held by English police authorities could be "decimated" by claims made for damage caused by the riots in English towns and cities.

Under the Riot (Damages) Act of 1886, insurers and the uninsured could claim costs from police authorities.

The Association of Police Authorities (APA) described the Riot Act as an "out of date law".

But the Association of British Insurers (ABI) said the regulations had worked well for 125 years.

Huge bill

The cost of loss and damage following riots across England has been estimated at well over £100m by the insurance industry.

Some businesses and householders who were uninsured or not covered could use the Act to claim for the costs of loss and damage - as long as they notify the local authority of an intention to claim within 14 days.

Insurers might also seek to recoup millions of pounds of losses that they suffer as a result of the disorder.

Graeme Trudgill from the British Insurance Brokers Association on whether you are covered for riot damage

The APA claimed that some insurance policies had exemption clauses for riots, although the ABI said that most policies would pay out following the riots.

The debate over the final bill has brought a strong reaction from the APA, which said that the public would see "little sense" in police funds being diverted to pay for repair bills.

The APA argued argued that financially-stretched authorities should not foot the bill for criminal damage.

"It seems to me a nonsense that when policing is facing unprecedented cuts and meeting the costs of ongoing disorder, it must also bear the brunt of paying for criminal damage because of an out of date law," said Ann Barnes, deputy chair of the association.

She called on the government to consider emergency help for police authorities to pay for responding to the "extraordinary widespread criminality".

Start Quote

This compensation scheme has existed on the statute books since 1886 with its operation having stood the test of time for the last 125 years”

End Quote Association of British Insurers

Police authorities were unable to access affordable insurance to cover the cost of compensating for this damage, the APA said.

This had been the case since the £38m of claims against Bedfordshire Police Authority following the riot in the Yarls Wood detention centre in 2002.

Premiums

The ABI said the Riot Act rules provided a safety net for the underinsured and meant that premiums did not rise every year to cover for a relatively rare event.

"This compensation scheme has existed on the statute books since 1886 with its operation having stood the test of time for the last 125 years," the ABI said.

"The scheme means that people do not have to pay higher premiums every year to insure their home or business because of a riot which may only happen once every 30 years."

It has written to the Home Secretary asking for the 14-day deadline to be extended to 42 days.

It said that insurers would pick up the bill for business interruption losses, which are not covered by the scheme.

A Home Office spokesman said: "We are in the process of reviewing the Riot Damages Act and are considering all options for reform.

"However, the legislation still remains in place and claims for compensation can still be made from businesses and households to police authorities."

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