Evolving business risks: Hong Kong protests
In recent weeks, Hong Kong has experienced massive public protests against the government’s handling of an extradition bill. The issue has drawn hundreds of thousands of people to the streets. While the government suspended the bill in mid-June, there was an unprecedented occupation of the Legislative Council on July 1. This has taken the demonstrations to a new level.
For companies with a presence in Hong Kong, these protests create risks related to business interruption – some a result of direct physical loss and damage; but, also, simply a result of the disruption these events cause, not necessarily linked to any direct physical loss or damage to impacted businesses.
What is Non-Damage Business Interruption?
Non-damage business interruption losses can manifest in a number of ways, either through the illegal occupation of property by protestors; through denial of access to premises by protestors due to shut-down by the authorities themselves; or through self-imposed lock-down for the safety of employees.
Businesses that rely on maintaining the footfall of the general public, such as hotels and shopping malls, are further exposed to the loss of attraction that mass protests can engender, which in turn results in rapidly diminishing revenues.
Across Asia, economies dependent on tourism and businesses in the retail and hospitality sectors are particularly susceptible to these risks.
Organisations must consider the threat level in the locations they operate in and evaluate the adequacy of their current coverage.
Non-Damage Business Interruption coverage provides an insurance solution for financial losses due to all of these perils. It protects you from loss of revenue or profit due to non-damage events and can be arranged as an extension of existing traditional Property Damage and Business Interruption (PDBI) cover, as a sublimit under the policy. This coverage can also be combined with loss of attraction cover to pick up past/present and future loss of earnings.