Greater Manchester's police authority may have to foot a bill of up to �2m following the riots in Oldham.

Under a piece of Victorian legislation, if a riot is officially declared insurance companies can recover any claims made against them from the police.

The Riot Damages Act of 1886 was designed to charge the local police for failing to prevent people behaving in a 'riotous or tumultuous' manner.

It was also invoked after riots in Moss Side, Toxteth, London and Bristol in 1981.

Malcolm Tarling from the Association of British Insurers said: "If you are a policy holder who has suffered damage to either your business or your home as a result of disturbances that occurred in Oldham, your first port of call is to claim from your insurance company.

"The insurance company then may have rights under an obscure act of parliament called the Riots Damages Act of 1886, to make a claim for compensation from the local police authority, depending on whether or not a riot has actually been declared.

No official comment

Greater Manchester Police Authority's emergency committee is debating the issue, and Greater Manchester Police are yet to make an official comment.

People making claims have to prove the events took place during a riot, and will have to show any damage occurred at a particular time in a specific location.