Chaucer, a global specialty insurance and reinsurance group, has emphasised the importance of political violence insurance for businesses with US operations due to a significant rise in public protests by US unions and workers.
There has been a 30% increase in US union and workers’ protests and demonstrations, with the number rising in the past year to 3,060, up from 2,351 the previous year.
Political violence insurance products including Strikes, Riots and Civil Commotion (SRCC) cover losses incurred from industrial action, civil unrest or violence by protesters.
Chaucer also highlights that the SRCC cover has proven to be popular in recent years in sectors like banking, retail, hospitality and real estate. A long-term rise in civil unrest globally has seen losses from protests excluded from general property insurance.
The reinsurer added, “Where SRCC in all-risk policies is included, it is often sub-limited or has a narrower wording coverage compared to that available in the standalone market. This has led to customers looking at the standalone Political Violence market to ensure they have adequate protection.”
It can be assumed that the cost of living crisis has primarily fueled the protests, US inflation was 4.1% for 2023 and 8% for 2022, while wage growth for many US workers has not kept pace over the same period.
Some of the examples Chaucer includes in this analysis are the 47,000 longshoremen at ports on the Gulf and East coasts which were suspended after two days; 33,000 Boeing machinists on the West coast; 2,000 Hilton, Hyatt and Marriott hotel workers in San Francisco; CVS pharmacy workers in Southern California and teachers in Massachusetts.
Alex Baker, Class Underwriter at Chaucer, commented, “The scale and duration of recent protests in the US has reminded businesses that they too may be impacted.
“Thankfully the recent strikes have not caused the kind of damage that have led to many claims. However, SRCC cover has become an increasingly important part of the insurance mix for businesses that may be affected by protests or civil unrest due to the locations of their properties.
“With big policy decisions set to be made in the coming months there is still a chance of further protests in the US – though the clear-cut election result has reduced some of the risk of broader unrest. We will continue monitoring the situation to ensure we are providing the best solutions for our clients.”
