Insurance Woes Impede Recovery

Photo: Jason E. Kaplan
A Portland downtown street with boarded-up storefronts

A lack of affordable insurance puts Portland businesses at risk of property damage and theft.

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On May 30, 2020, during demonstrations for social justice in Portland’s downtown, someone broke the storefront window of Mercantile Portland, a high-end women’s clothing store on the corner of Southwest Alder Street and Park Avenue. Over the next several hours, thieves stole goods and vandalized the interior.

The shop was closed for the next four months as the owner fixed windows and cleaned up the place. The total for the repairs and the stolen goods came to $1 million, says Eric Murfitt, controller of Mercantile Portland.

The store reopened in September, and Murfitt says the business’s insurance should cover most of the damage. But the insurance company refused to renew the policy, and the business was forced to find alternative coverage in the wholesale market.

Only one carrier out of more than a dozen agreed to provide insurance. That coverage comes with a premium that is four times what the owner was paying previously. The deductible went up 25 times.

The new policy also offers only limited coverage. It will not reimburse for damage caused by civil unrest. If the same kind of looting happened again, the business would receive no money.

Mercantile Portland’s windows remain boarded up because of the lack of insurance. Murfitt is also not confident the police would help if it happened again. An investigation of the theft and property damage still has not taken place, he says. But he emphasizes he does not blame the police. “I blame the city. They manage the police department,” he says. “It is shocking how the city has handled it.”

Murfitt is not alone in criticizing city officials for their handling of the property damage and vandalism that have plagued business owners during the Black Lives Matter protests. During the demonstrations, a small group of people broke windows and looted goods from several downtown businesses. Shop owners complain officials did little to bring the perpetrators to account.

Boarded up downtownA boarded-up storefront in Portland downtown   Photo: Jason E. Kaplan

The Rose City Downtown Collective, a group of businesses that recently formed to raise awareness of the plight of small businesses as well as raise funds to help with the cleanup of downtown, has been vocal about what it sees as the lack of action taken by city officials on the property damage.    

RELATED STORY: Saving Downtown

The fact that downtown Portland has almost become a ghost town because most office workers are working from home during the pandemic has worsened the instances of vandalism. “There are no eyes on the street, so there is more vandalism,” says Steven Lien, CEO of underU4men, a men’s-underwear store on Southwest Washington Street and Park Avenue.

DSCF8549Boarded-up windows at downtown mall Pioneer Place  Photo: Jason E. Kaplan

Lien’s shop windows were broken during the protests. The cost of repairs and cleanup came to $4,000 after a $2,500 insurance deductible was applied, says Lien. He doubts the store will ever make up the out-of-pocket costs because of the lack of customers coming into the store. The shop is open but remains boarded up. He has installed new security gates.

While insurance costs bother Lien, he is also concerned with the frequency of shoplifting in downtown, which he describes as “off the charts,” as well as the “nonexistent” police response to theft and vandalism.

Lien still thinks having a brick-and-mortar shop is viable. His online store is also a “lifeline,” he says. But as more businesses around him close, he is feeling increasingly isolated.  

For Louella Scott, owner of Flowers Tommy Luke on Southwest Harvey Milk Street and Second Avenue, the growing number of homeless people around her store is one of her biggest concerns. The number of homeless has increased “dramatically,” she says.
Her store remains boarded up after her store’s window was broken. People rarely come into the shop anymore, she says. She was quoted $1,118 for the window repair, while her insurance deductible came in at $1,000.

Despite everything, Scott wants to stay downtown where she has run the 114-year-old florist for the past 10 years. “I am blessed my company has a deep and long-lasting presence in Portland,” she says. “I am committed to downtown.”

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