France Riot Damage Count Doubles to 3,000 Shops; Insurers Still Have No Loss Estimate

Since the weekend of Oct. 17-18, when nationwide cost-of-living marches turned into looting and arson, the arrest count has reached nearly 2,400 and the Limoges town hall has burned. The next question is who pays for the wreckage, and the number keeps growing.

By Monday, the government's count of damaged shops had reached at least 3,000. That is double the roughly 1,500 that Carrefour chief executive Alexandre Bompard, who also chairs the FCD retail federation, cited on Sunday. Bompard put the retail industry's losses at several hundred million euros at that stage.

Carrefour alone reported damage at 50 stores. Twenty of them were looted.

Insurers mobilised, but no number yet

France Assureurs, the insurance federation, says its members are "fully mobilised to support affected policyholders." It could not give Euronews an initial loss estimate or say how many claims have been filed. It described the weekend as "extremely violent events."

There is an outside estimate. Morningstar DBRS expects insured losses of no more than €1 billion to €1.2 billion, assuming no further violence. Marcos Alvarez, the agency's global head of insurance, called it "a manageable earnings event rather than a capital event" for the big insurers, after reinsurance recoveries and potential claims against the French state.

Alvarez also warned that riots now behave like natural catastrophes for insurers. The risk, he said, is "correlated claims across multiple cities at the same time."

The 2023 benchmark

The June-July 2023 riots cost insurers €793 million, according to France Assureurs. Insurers handled about 17,000 claims, averaging roughly €46,600 each.

Shops and business premises took €523 million of that. Local authorities, whose town halls, schools and buses were attacked, accounted for close to €200 million. Cars were the remaining 7%.

A later French Senate inquiry put the property damage nearer €1 billion, because some losses never reached insurers.

The state backstop is not ready

France has approved a state-backed riot insurance mechanism. It would make riot coverage mandatory and let insurers pass a large share of qualifying losses to the Caisse Centrale de Réassurance, the public reinsurer.

It is not operational. Alvarez said that means it "does not protect insurers against the latest riots."

The shopkeepers at the bottom of the chain are already tallying their own bills. Pharmacist Fabien Carême told The Epoch Times that stock alone cost him close to €150,000. Optician Camille Michelin put his losses above €50,000. A marble showroom owner identified only as Yoni found a €25,000 table smashed to pieces.

Euronews reports that lost trade, the income shops forgo while they are closed or rebuilding, may not be covered. The federation has not addressed that point.

Markets took a hit

French assets sold off Monday. The CAC 40 closed 1.1% lower, underperforming the Euro STOXX 600, which fell 0.9%. Carrefour shares dropped 2.2% and LVMH fell 1.8%. A Louis Vuitton boutique in Marseille was among the stores broken into.

Insurers fell too. AXA lost 1.3% and reinsurer SCOR 0.9% in Paris. In Milan, Generali fell 2.3% and Unipol 3.2%.

The 10-year French government bond yield rose about eight basis points to 4.94%. Germany's equivalent rose by less than four. The gap between French and German borrowing costs widened to roughly 148 basis points.

No source ties the bond move to the riots specifically. Monday's selling did coincide with the weekend's damage reports.

Macron's promise

President Emmanuel Macron said in his Sunday address that "those who destroyed must pay, those who looted must repay." He also said shopkeepers "will not be left alone." He blamed "seditious elements from ultra-left splinter groups, joined by many criminals."

The Paris police prefecture described those detained on Sunday afternoon as "essentially young people from the suburbs looking for looting opportunities."

Macron has not said how the state will compensate merchants. He has asked the government to convene students, teachers, lawmakers, union representatives and business leaders this week to draft "concrete proposals."

The cost of enforcement is also rising. Interior Minister Laurent Nuñez said almost 1,000 officers were injured. Justice Minister Gérald Darmanin has already directed prosecutors to push for parents to be held financially liable for damage their children cause in the earlier school unrest.

It is unclear whether the promised state help will cover uninsured losses and lost trade. Insurers will only start to learn their own tally as claims are filed in the coming weeks.