LOS ANGELES COUNTY : Probe of Riot Insurance Cancellation Ordered
The Board of Supervisors on Tuesday unanimously approved a motion calling on the County Insurance Commission and the county chief administrative officer to conduct an inquiry into the cancellation of riot insurance coverage of small businesses in South Los Angeles.
Introduced by Supervisor Yvonne Brathwaite Burke, the move came in the aftermath of a decision last week by Crusader Insurance Co. of Woodland Hills to discontinue fire and vandalism coverage for about 1,200 small businesses in riot-affected areas.
Cary L. Cheldin, executive vice president of Crusader Insurance, said the mass cancellations were ordered to protect the company from bankruptcy in the event of more civil unrest.
The motion calls for a report with recommendations from the inquiry to be delivered to the Board of Supervisors by May 6.
Victoria Pipkin, a spokeswoman for Burke, said the recommendations could result in the county taking legal action, such as filing a civil rights lawsuit, against Crusader. Burke said the results of the inquiry will be forwarded to the Congressional Subcommittee on Consumer Credit and Insurance in an effort to enact national legislation to combat insurance redlining.
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