The new Pandemic Risk Insurance Act, endorsed by ASAE, would create a federal backstop to prevent economic losses from future pandemics.
ASAE endorsed a bill introduced on May 26 by Rep. Carolyn Maloney (D-NY) to create the Pandemic Risk Insurance Program, a system of shared public and private compensation for business interruption losses resulting from future pandemics or public health emergencies.
The COVID-19 pandemic has caused severe financial strain on America’s associations resulting from cancelled meetings, conventions, and tradeshows not covered in existing insurance policies. Creation of a Pandemic Risk Insurance Program is one of ASAE’s primary asks of Congress to ensure future event cancellations resulting from a pandemic are covered.
Maloney’s bill (H.R. 7011) would require insurance companies to offer business interruption insurance policies that cover pandemics and ensure there is sufficient capacity to cover these losses and bolster the economy in the event of a future pandemic. Much like the Terrorism Risk Insurance Act, enacted shortly after the terrorist attacks on 9/11, the federal government would serve as a backstop to maintain market stability and to share the burden alongside the private insurance industry. ASAE looks forward to building support in Congress and among stakeholders for this important legislation.
“The Pandemic Risk Insurance Act offers a critical solution for associations and others devastated by event cancellations, slashed reserves, and sharp membership declines amid COVID-19,” said ASAE President and CEO Susan Robertson, CAE. “ASAE thanks and applauds Congresswoman Maloney for introducing this important bill, which will no doubt help provide America’s 62,000 associations the security they need to fully reignite our community’s far-reaching economic impact through industry-focused conferences, workforce development, and educational programming, among other critical services.”
The bill would not be retroactive to cover COVID-19 losses, but the program would be triggered after $250 million in aggregate industry losses and following any future declaration of a covered public health emergency or pandemic.
“Millions of small businesses, nonprofits, mom-and-pop shops, retailers, and other businesses are being left out in cold and will never be able to financially recover from the coronavirus crisis because their businesses interruption insurance excludes pandemics,” said Maloney in a press release. “We cannot allow this to happen again. These employers and their employees need to know that they will be protected from future pandemics, which is why I am introducing the Pandemic Risk Insurance Act.”