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Insurance claims on the hundreds of businesses burned and looted in last week's riots are expected to dwarf the payouts after the 1965 Watts riots and likely will surpass the $1.2 billion in claims paid after the Oakland fire in October 1991, according to insurance experts.
When adjusted for inflation, the total of all claims paid as a result of the 1965 Watts riot totaled $88 million, industry sources said.
The riots and burnings that began in South Central Los Angeles started at the end of the workday, April 29, after it was announced that a jury in Simi Valley acquitted four Los Angeles police officer on all major counts for beating a black motorist, Rodney King, after they stopped him for wreckless driving last year.
So widespread was the arson, looting and physical violence that some insurance agents contacted the morning after the riots thought many insurance companies would no longer do business in the area. In other cases, insurers said the losses have to be taken in stride and that they won't raise their premiums unless the violence continues.
Inglewood-based Morris Davis Jr. has been writing fire and casualty insurance in South Central Los Angeles since 1959. He said premiums will rise and business owners may not be able to buy enough coverage to...