Picking up the pieces: how businesses were helped to recover from the 2011 riots

30 October 2012

This report from our Budget and Performance Committee warns that more should have been done to speed up compensation payments and provide aid for businesses hit by last year’s riots.

UPDATE: November 2013

In November 2013 the Home Office published an independent review of the Riot Damages Act. We welcomed the recommendations of the review, which shared out concerns around the definition of a riot, scope of compensation and need to work closely with the insurance industry to speed up the payment of compensation under the act.

Our report

‘Picking up the pieces’ outlines a series of recommendations designed to apply not only to the aftermath of rioting, but also to other events like flooding or major fires.

It argues that poor coordination immediately after the riots and lack of urgency from Government and the insurance industry to settle claims held back the recovery process. Despite having the knowledge, resources and skills available, the report warns that a comprehensive recovery service was not put in place and many small businesses were left confused about where to look for help.

John Biggs AM, Chair of the Budget and Performance Committee:

Insurance companies are subject to particular criticism, with the report pointing out that four months after the riots a third of businesses were yet to receive a penny from their claim, with many relying on charity handouts from organisations like the High Street Fund to keep afloat.

The report calls for:

  • The Association of British Insurers (ABI) to produce clear and straight forward guidance for people affected by rioting to help them through the claims procedure
  • The ABI should publish the average payment times for each of its members following the riots and other major incidents
  • The ABI and the Mayor should examine the problem of under-insurance among small businesses and recommend some solutions.
  • The insurance industry should play a leading role in the administration of a reformed Riot Damages Act After future events, local authorities should set up a single point of contact to provide information for philanthropic organisations

The Committee held a follow up meeting on Tuesday 4 December at City Hall to discuss implementation of the recommendations with representatives from the Insurance industry, the government and the High Street Fund.