Chicago businesses, having sustained enormous damage from rioting since the
weekend, are finding a lifeline in their insurance policies, provided they were
fortunate enough to have one. For the big-box stores and national chains,
insurance to cover property damage, inventory loss and business interruptions
are a standard part of operations. Experts said that most smaller merchants also
carry coverage that will help them recover. “I don’t think the situation will be
as dire as some say it could be,” said Michael Schwartz, executive vice
president of insurance adjustment firm L.J. He said the industry, following
established practice for disasters, has been quickly handling claims under a
triage system—assigning personal visits for the worst cases and helping
merchants with board-up Simpler claims for a broken window might be handled
remotely. Schwartz said standard policies provide coverage for riots or civil
disobedience. An online brokerage, Next Insurance, found in a survey of 44% of
small businesses never have had coverage, but its results may have been skewed
by responses from sole Judy Frydland, commissioner of the city’s Buildings
Department, said Monday that her agency has surveyed damage to 180 commercial
properties as of early Sunday. In 50 cases, the department enlisted its own
vendors to do board-up work. She urged business owners to call 311 if they need
help securing their properties. “We are not your obstacle but are here to
partner with you,” Frydland said. Many have drawn comparisons between the unrest
and the 1968 riots that followed the assassination of Dr. A study by the
Insurance Information Institute found that, in 2020 dollars, the city’s 1968
riots produced $97 million in insurance claims, ranking it as the ninth most
expensive The study found the most expensive, by far, were the 1992 riots in Los
Angeles that followed the police beating of Rodney King. Those generated an
estimated $1.4 billion in claims when adjusted for inflation. Schwartz said that
while he hasn’t been called to handle business related to the Chicago mayhem,
another executive at his firm has gone to Minneapolis for claims from the
demonstrations there. Minneapolis is where George Floyd died in police custody,
prompting peaceful protests in cities nationwide but also looting and property
damage. The last time he’s seen a surge of claims from Chicago, Schwartz said,
was the riots that accompanied the Chicago Bulls’ titles in the 1990s. The
financial cost of recovery, however, is just part of the challenge businesses
face. For Sam Sanchez, owner of two River North restaurants that were ransacked
late Saturday, he can’t shake the memory of what went beyond theft to wanton
destruction. Watching security video from his home, Sanchez saw people smash TVs
and sound equipment with hammers, destroy furniture and steal artwork only to
throw it in the street. He owns Moe’s Cantina and Old Crow Smokehouse in River
North. Sanchez said he has started his claims and estimates the damages at
“easily over $100,000.” The destruction came as he was planning to open for
outdoor dining on Wednesday under the city’s planned relaxation of rules for
COVID-19. That deadline may be deferred now, but Sanchez said it’ll take him at
least 10 days to replace tempered glass and reopen if allowed. “It’s just
material stuff, and it’s hard to see the violation of your personal property.
But this means your employees can’t work, and insurance doesn’t cover that,” he
said.
