Business Groups Unite to Protect Riot-damaged Firms

Business groups are united in condemning the looting that targeted retailers in English cities, and have urged business-owners to check their insurance policies to make sure they are protected from damage and lost trade caused by civil unrest.

They have also called on Government and banks to help damaged businesses get back on their feet after nights of disorder in London, Manchester, Birmingham, Bristol and other cities caused tens of millions of pounds of damage.

The Association of British Insurers (ABI), which says the total insurance payout could be upwards of £100 million, has issued advice to businesses on making insurance claims.

In particular, they urge businesses to check that they are actually covered for civil unrest.

“Most commercial insurance policies will cover businesses for damage to their premises, including the interruption to their business as a result,”

said the ABI’s director of general protection and health Nick Starling.

“Some policies will also cover those businesses which are not damaged, but whose trade is affected by the aftermath. Insurers are working as quickly as they can to deal with claims. However, access to dangerous buildings which are also crime scenes is a serious issue.”

The ABI has also advised that businesses may be able to claim compensation from their local police authority under the Riot Damages Act (1886). The more recent Public Order Act specified that disorder does not have to be classed as a riot for businesses to claim compensation.

Normally claims must be made within 14 days but the Government has announced an extension to 42 days to give people more time.

HMRC to be lenient on tax payments

HM Revenue & Customs (HMRC) has announced it will be lenient with small businesses that may have lost tax records in the riots and agree payment schedules with those who are unable to pay their tax bills due to short-term financial difficulties.

The tax body said that in these circumstances it would review any penalties imposed and withhold any additional surcharges that would normally be triggered by missed deadlines.

Federation of Small Businesses chairman John Walker said that with so much damage already done, recovery from the riots could be a long, hard process.

“This disruption is causing untold damage to individual businesses, our extremely fragile economy and our image, less than a year ahead of the [2012 London] Olympic Games. Our cities simply cannot afford for this to continue and it’s impossible to estimate how much this is going to cost the business community.”   

The British Retail Consortium (BRC) has urged banks to extend medium-term credit arrangements to help small businesses carry out repairs quickly, restock and get trading again.

“As well as the immediate bills caused by damage and theft, there will be longer-term costs,”

said BRC director general Stephen Robertson.

“Inevitably, some businesses which have been attacked will never open their doors again. Banks need to offer good credit arrangements to those targeted so as many as possible have a chance to refit and reopen.”

The Forum of Private Business and the Association of Chartered and Certified Accountants are jointly supporting Riot Rescue, an online “matchmaking” service created to put small businesses in touch with voluntary local support. Many other small traders, such as builders, glaziers and carpenters, are offering their services for free to help damaged businesses get back on their feet.

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