NU Online News Service, Aug. 15, 2:58 p.m.EDT

The Association of British Insurers (ABI) says it expectsinsured losses of more than 200 million pounds (about $328 million)from claims connected to the rioting and looting in London andother cities recently.

The estimate is more than double the ABI's initial loss estimate.

The news comes as Prime Minister David Cameron extended the timeto report claims under the Riot Damages Act of 1886.

The British police are required to compensate individuals andorganizations who suffer property loss or damages from ariot—regardless of whether they are insured—and insurers can alsomake a riot-compensation claim for the amount of claims paid topolicyholders who suffered riot-related property losses anddamages.

Business-interruption losses are not covered under the act.

The ABI says it has offered assistance to the government andpolice in handling claims.

In lockstep, Zurich Financial Services Group extended the timeperiod for property-insurance policyholders to report claims.Allianz says it expects about 25 million pounds ($41 million) inclaims.

“The insurance industry is already paying out claims to peoplewith insurance, but wants to do more to support the government inhelping people get back on their feet,” says Otto Thoresen, ABIdirector general. “We will work in partnership with the governmentand share our expertise to make sure that the police compensationschemes work effectively and get compensation to people who need itquickly.”

ABI says home insurance should cover fire, looting and damages.Many policies also provide payments if homeowners cannot stay intheir home.

Most commercial policies will cover damages and businessinterruption caused by fire, looting and other damages. Somepolicies will cover interruption to businesses that were notdirectly damaged by the riots.

Crawford & Co., an independent provider of claims-managementservices, says key considerations for businesses are adequacy ofcover and—in cases where an insured takes damages at more than onelocation—whether or not the riots will be classified as one eventfor the application of deductibles.

Standard business-interruption policies may be extended in somecases to include coverage to a business owner who cannot access hisbusiness because of destruction or damage at neighboringbusinesses.

Also, some policies provide coverage for “loss of attraction.”This is relevant is the business depends on neighboring business togenerate income, Crawford says.

For the policy to be triggered, a drop in business needs to becaused by damage rather than a “general decline in trade in thearea because it is less popular,” Crawford continues.